2nd Parliament · 3rd Session
The President took the chair at 3.30 p.m., and read prayers.
page 3054
asked the Minister representing the PostmasterGeneral, upon notice -
In view of the importance of securing an uniform system of wireless telegraphy throughout the Empire, will the Government refrain from definitely committing the Commonwealth to any scheme until an opportunity is afforded of discussing the subject in all its aspects at the Imperial Conference, to be held next April ?
– The answer to the honorable senator’s question is as follows : -
The whole question is under consideration, and the Postmaster-General is not in a position at present to make any definite statement in the matter.
page 3054
– Before the business of the day is called on, I wish to intimate to the Serrate that His Excellency the Governor-General has fixed 5 o’clock to-morrow, at Government House, as the time for the presentation of the AddressinReply to the speech with which he opened Parliament.
At a later stage,
– I have to announce to the Senate that in response to a telegram sent by me, His Excellency the Governor-General has altered the time for the presentation of the Address-in-Reply to a quarter to one o’clock on Thursday next.
page 3055
– - As a matter of personal explanation, I desire to say that last week Senator Pulsford made a request that I should lay upon the table of the Senate a copy of an affidavit by Mr. William Marshall, which I had read during the course of my speech on the Australian Industries Preservation Bill. If it had been made after I had concluded my speech, I certainly should have complied with the request, and if the honorable senator can suggest any way by which I can take that course now, I shall be prepared to do so.
– Mr. President-
– I do not know, that this is exactly regular. By the indulgence of the Senate, a personal explanation may be made, but I do not think that one honorable senator can call upon another honorable senator to indicate what mav be done.
– In a matter of this kind, sir, is it not competent for an honorable senator to ask your advice? Senator McGregor has disclosed a difficulty. He has been requested to place a certain document upon the table, and he has stated that if a suggestion can be made to him as to how that can be done, he will be willing to adopt it. I appeal to you, sir, as presiding officer, to say whether I am not correct in intimating to the honorable senator that it is competent for him or any other honorable member of the Senate to place a paper on the table at any time?
– No. The Standing Orders provide who may lay papers upon the table. No private senator can do so.
page 3055
Debate resumed from 17th August (vide page 3014), on motion by Senator Playford -
That the Bill be now read a second time.
– I think it will be admitted that the subject-matter of the Bill is well calculated to cause an interesting debate. It will also be acknowledged that, so far, we have nothing to complain of in that regard, because the speeches have been very able and very interesting, and I think fairly descriptive of the attitude taken up by various parties here on questions such as the Bill is supposed to deal with. It clearly sets out the Government policy. At all events, if we remember the pronouncement of the- Prime Minister at Adelaide, when he declared for legislation for the controlling of trusts, the policy may be briefly described as one to allow trusts or monopolies to remain in the hands of private monopolists whilst bringing forward legislation for the control of trusts. While the Labour Party are quite prepared to go the whole way with the Government, and assist them in passing legislation of that kind, we are also prepared to go much further. At the same dme. when, it is remembered that very important trusts or monopolies are in the hands of private persons, it must be recognised that legislation of this kind is an absolute necessity. I believe that the Bill is merely the forerunner of much legislation of a similar kind which will be forced upon the attention of Parliament. At all events, that has been the experience of the United States, and I think it will be the experience of Australia. Just as our industries develop into trusts, industrial life has developed from the competitive stage to a much less severe competitive stage, and capital has been concentrated into bigger and still bigger concerns. I believe, therefore, that legislation of this* kind will be forced upon Parliament from time to time. Just as we have had in the past, and, I think, will have in the future, labour legislation, to make the present state of affairs tolerable-
– Does the honorable senator call this a labour Bill?
– I am not referring to it as a labour Bill. I am saying that in the present state of affairs labour and anti-trust legislation will be forced upon Parliament in order to control those monopolies which have fallen into the hands of private capital in contradiction to the policy of both the Labour Party and the Government. We recognise that this tinkering measure does not provide for anything like a radical cure. We hold that the root of this economic disease must be touched before anything like a complete cure is provided. I look upon this mea- > sure just as I regard the application of cintment to the surface of a sore; it mayease the trouble for the time being, but it will by no means effect a cure of the disease. But in direct contradiction to the policy of the Labour Party, and that of the Government as manifested in the Bill, we have Senator Symon, as leader of the Free-trade Party, rising and declaring for no kind of interference by means of legislation to control trusts while they are in the hands of private companies, and at the same time dissenting from the Labour Party’s much more advanced and drastic proposals for the nationalization of the industries when they have reached the stage of private monopolies. True to his freetrade ideas of no control of trusts by legislation ; true to the old let-alone policy so characteristic of the Manchester school of politicians, he affirms that in such matters the Government should not interfere iri1 any way. He also declared that the Bill would only be applicable in regard to the free competition of trade in Australia. He even went further than that, and said that in Australia we had no trusts to control. I think I shall be able to show that iri’ Australia we have not only trusts, but trusts which are injurious to other sections of industry, and which are preventing legitimate competition. The Constitution provides a very good precedent for this kind of legislation. Its framers foresaw the necessity of giving power to this Parliament, if need be, to interfere with Government monopolies. - to interfere with the Government railways of the various States if it were found that thev were acting unfairly as between State and State. Section 98 says -
The power of the Parliament to make laws with respect to trade and commerce extends to navigation and shipping, and to railways the property of any State.
Section 101 provides for the appointment of an Inter-State Commission to carry out the provision of that section, and also section 102 which reads as follows: -
The Parliament may by any law with respect to trade or commerce forbid, as to railways, any preference or discrimination by any State, or by any authority constituted under a State, if such preference ‘or discrimination is undue and unreasonable, or unjust to any State . . .
Seeing that the Parliament is clothed with those powers, surely we are not going cut of our way in passing this measure. If it is necessary for Parliament to have power to legislate as to State monopolies, how much more right have we to control private monopolies which are in the hands of irresponsible persons, and which are acting very unfairly towards various sections of the community ?
– And very often giving secret rebates.
– I shall deal with that question later on. I think I shall be able to prove that the trusts and rings in Australia are of a very injurious nature. We are simply performing the duties which are imposed upon us by the people in passing legislation to compel them to give fair play to various sections of the community.
– But this Bill will not touch the established monopolies or trusts.
– I admit that various views may be taken as to the scope and purpose of the Bill. But if it can be made more stringent in order to deal’ with existing trusts, let that be done. All I am now contending for is that in our midst we have private monopolies, and that it is a proper thing for this measure -to be passed. In my opinion, the most injurious monopoly we have is the shipping ring, because it practically controls the whole of the shipping on the coast of Australia. Amongst other things, the Navigation Commission discovered that the tonnage on the Australian coast comprised 188,000 tons, and that out of that tonnage less than 10,000 tons were outside the shipping ring. In America, the land of trusts, possession as to the means of transportation, in the shape of railways, gives trusts enormous power, but we in Australia, owning our railways, have to a considerable extent been free from that exercise of power. But the means of transportation between Tasmania or Western Australia and the other States is in the hands of private monopolists, who are known as the Ship-owners’ Federation, and I believe I am amply justified’ in saying that they have used that power very unscrupulously, and in a way unfair to the merchants of Australia, to the employes engaged by them in some regards, and to other ship-owners.
– We have the cheapest coastal freights in the world.
– I do not . think so. It was stated in evidence before the
Navigation Commission that the freight between Melbourne- and Fremantle is in some instances higher than the freight between Melbourne and London.
– That is not a coastal trade, but deep-water trade. I said that we have the cheapest coastal freights in the world.
– For more than three times the distance less freight is charged. ,
– With cargo each way. The people of Western Australia do not send hack ten tons by each boat. They have nothing to send.
– Not only does the shipping ring control the coastal trade, so far as -.transportation is concerned, but its ramifications extend into the coal trade. Some years ago a friend of mine desired to open a coal trade in Western Australia. At that time the coal trade in that State was a very good one for those who were engaged in it. An independent colliery proprietor in Newcastle, who was not connected with the shipping companies, asked me to obtain certain information in connexion with the coal trade of Western Australia, which I did. Afterwards he told me that he had found that, while the market in the State was a. good one - much better than he could obtain elsewhere - the freight was in the hands of the shipping ring, and he was excluded from entering the market. It will be seen, therefore, that the power in the hands of the ring at the present time is very great indeed.
– The greatest customers for coals are not having them carried bv the shipping ring at all. I refer to the Broken Hill Company.
– There is one company outside the ring that is carrying coal, but it does a very small trade in Western Australia. The principal coal merchants there get their coal from the Adelaide Shipping Company, and from Mcllwraith, McEacharn, and Company, which are members of the ring. When the Navigation Commission was engaged in taking evidence, the witnesses sent by the Chambers of Commerce spoke more strongly than any other witnesses with, regard to the action of the shipping ring. I have here an extract from a letter sent to the Prime Minister by the Melbourne Chamber of Commerce. It is dated 9th November, 1904, and is as follows: -
I am directed by my council to bring under your notice a most pernicious system that has grown up in shipping circles, under the name of freight rebates. These rebates, in fair and honest trading, are absolutely unnecessary, and in many instances are a gross injustice to consignees. Where goods are sent by a producer, who is some distance from the seaboard, to be shipped by an agent at the shipping port, these rebates too often take the form of a secret commission; and where the rebate is allowed to a shipper direct, it is granted only on the understanding that he confines his business to certain companies within the shipping ring, or trust, the conditions under which this rebate is allowed are that the company, whilst collecting the freight on a cash basis, when the goods are shipped, will only return the percentage, after twelve months, and during that time the shipper must confine his shipments to the ring;.
Senator Symon has declared that this Bill will prevent competition. I hold that we have not got competition in Australia now. As far as the coastal trade is concerned, the shipping ring prevents it. The Bill, in my opinion, will not be found to be drastic enough for its purpose. We shall require a measure somewhat like the Elkin Act of the United States, which makes it a penal offence for any transportation company to give any rebate. Respecting the treatment of the merchants of Australia by the shipping ring, I should like to quote the evidence of Mr. Alexander, who was appointed by the Fremantle Chamber of Commerce to give evidence on this matter. He said -
I regard the coasting shipping companies as an octopus. I regard them as a menace to Australia. Merchants in Western Australia dare not ship with any company outside the ring. I got into trouble with the ring because I shipped .with the Julia Percy, an opposition boat trading between Fremantle and Geraldton.
I know a merchant that committed the heinous crime of buying Jones’ Tasmania jams that had been brought to Western Australia by a ship outside the shipping ring. He was either cut off or threatened to be cut off.
The representatives of the Chambers of Commerce had no doubt as to the operation of rebates in connexion with these transport companies. Mr. McPherson, of the Melbourne Chamber of Commerce, said in his evidence -
Speaking as a manufacturer, as well as a merchant, “I am able to say that these shipping combinations tell very adversely against Victorian manufacturers doing business with other States.
Another witness, Mr. McLellan, agent for J. and A. Brown, one of the few commercial shipping companies outside the ring, also gave evidence.
– He is the man who invented the rebates.
– He is all the greater authority on that account. Having had a hand in framing the system, he knew what he was talking about. He said -
The bonus system is so perfect in its operation as to prevent any possibility of legitimate competition arising outside the shipping ring.
Mr. Spence, a member of the executive of the Brisbane Chamber of Commerce, said -
I am entirely against the system of rebates that is in vogue among the shipping companies. I think it is iniquitous. They practically come to the merchant with a pistol at his head, and say you shall do so and so. . . . They use the rebate system is a means of coercion. If they came to-morrow, and said we intend to advance your rates 30 per cent., the merchants are powerless and at the mercy of the shipping ring.
Another merchant, Mr. Calthrop, of Fremantle, who was asked by the Chamber of Commerce of that city to give evidence before the Commission, said -
My freights amount to£4,000 or £5,000 yearly, mostly from the eastern States. I am supposed to get from the shipping companies a rebate of 10 per cent. This is entirely optional on their part. If, for instance, you sent me by a non-associated boat, a package the size of a tin tack, and it was on the manifest, and the shipping companies found it out, they would put me on the black-list, and keep all the rebates, which they have withheld in my case for two and a half years.
This testimony will give honorable senators some idea as to how the shipping ring treats the merchants. When they have got a customer they do not let him go. This witness had been two and a half years trying to get the rebates that were due to him from the companies. Another witness, Mr. Bateman, a merchant of Fremantle, and also a ship-owner, gave some important evidence. I read this, not only for the sake of supporting my contention regarding rebates, but also to point out theboycotting practices of the shipping ring of Australia, and how these companies have it in their power to crush out other shipowners when they make up their mind to do so. Mr. Bateman said -
About the middle of last year I had a small vessel running to Bunbury. I had not been doing particularly well, but the trade was growing. Suddenly one of the Inter-State companies put on another boat in opposition, and at the same time issued a rebate circular which had the effect of stopping all shipments in my vessel by local merchants, because they were threatened if they shipped with me, not only would they lose their rebates on cargo shipped at Bunbury and the Vasse, but on the cargo shipped to or from the eastern States. This had the effect of taking all the trade from me, and I had to pay off the crew, and laid up the vessel, and she has been laid up ever since.
– That is trade union tyranny !
– That is business as practised by the shipping ring of Australia. If it were done by a trade union secretary, the press of Australia would be howling its loudest, but not a word was said about these practises. Not a word appeared in the capitalistic press in reference to them. Naturally we do not expect the capitalistic press to expose its own customers, even to show the tyranny that is practised in Australia in connexion with the shipping on our coast. Here is a West Australian who was actually driven off his own coast by. the Adelaide Steamship Company. That was the company which put on an opposition steamer, and it was its manager in Western Australia, Mr. Downer, who sent the letter to the merchants who were doing business with this man.
– Did he advertise as largely in the newspapers as the shipping companies did?
– No doubt the newspapers would make the shipping ring pay up. They all have their price.
– Does the honorable member seriously make a statement of that kind ?
– Is the honorable senator so innocent as to doubt that such a thing could happen?
– I do doubt it.
– Senator Symon has made the statement that we have no injurious trusts in Australia. Will any man dare to say that this shipping trust is not injurious to the other ship-owners and collier-owners who come into competition with its vessels, seeing that it can simply cause the newspapers to close their columns against any outcry when it so unscrupulously deals with other ship-owners? I think there can be no possible doubt about that.
– Did the labour newspapers draw attention to these matters before the evidence given to the Navigation. Commission was taken?
– I do not know what the labour newspapers did, but I do know that they are ever ready to give publicity to anything of that kind. Senator Gray must acknowledge that.
– I perfectly agree with that.
– I have indicated the treatment meted out to the oppoments of the shipping ring, both in the coal and the transport trades. I should also like to point out briefly the treatment that is meted out to the officers on the vessels owned by the shipping ring, the hours of labour worked, and the wages paid. I have here the evidence of Mr. Dakin, which indicates that exceedingly long hours are worked on- these vessels by officers when in port, and dealing with cargo. He shows that officers are on duty from twenty to thirty-five hours at a stretch, and that the moment they go to sea after finishing with the cargo, these officers! have to go on the bridge and take their watch, although they may be more fit to go to their berths and sleep. Mr. Dakin was asked why it was, if this treatment was meted out to master mariners, they did not form an association to protect their interests. He replied that they had tried to do so, but that their efforts were very quickly squelched; whilst those who took a leading part were blacklisted, and kept out of employment. As the shipping ring had control of the trade of Australia, these men would have to go out of the country to get a living.
– The Steam-Ship Federation has not a ship running on the coast of New South Wales, and Mr. Dakin was speaking about the New South Wales coast only.
– He gave evidence not only about New South Wales, but about the coastal trade generally.
– No.
– I can quote evidence to prove my statement beyond a shadow of doubt. Mr. Dakin, mastermariner, said in his evidence -
A steamer leaving Brisbane -
That is not on the New South Wales coast - bound to Cairns is usually in port all day, and proceeds to sea at night. The three officers are on duty all the time. … I know of instances where men have continued at work for twenty to thirty-five hours consecutively, and then they have had to go to sea, take charge on the bridge, and carry on regular work.
– Does the honorable senator think that that has anything to do with this Bill?
– Certainly .
– The honorable senator is arguing about rates of wages and hours of labour. Surely that has nothing to do with the Bill ?
– If I consider that a trust in Australia is unfairly treating its officers, surely I haw a right to urge that we should legislate so as to control it ?
– This Bill does not attempt to do that. It does not attempt to affect hours of labour or wages.
– It may be necessary for me to move amendments to make the Bill do so. I use these arguments to show that there is need to amend the Bill in those respects.
– The honorable senator seems to me to be introducing irrelevant arguments.
– If the argument is out of order, I shall not persist in it, but I think I have sufficiently proved that the snipping ring is of an injurious character, and that wes are justified in passing legislation to control it. Of course, I admit that it will be very difficult for us to get at the responsible people. Legislation of a similar kind in the United States has undoubtedly failed to effect anythink like a radical amendment. The power of the “boss” is very great, and these people have enormous capital at hand. They can undoubtedly make use of their capital to safeguard themselves from the effect of any legislation we mav pass.
– Are not the shipping companies controlled by our laws in regard to wages and hours of labour in Australia?
– Unfortunately, as far as our Conciliation and Arbitration Act is concerned, our ships’ officers have not yet been affected by it. They have applied to the Court to cite’ a case, but up to the present have not been able to secure a hearing. I should like to lay before honorable senators the opinion of the President of the United States, only recently expressed, as to the power of the trusts- over lawyers. We know the power. of the trusts in various directions ; we know that they have practically captured the Senate of America, and have such a. controlling effect in Congress that they can defeat or get past almost every kind of law.
– That is a great reflection on the big Republic.
– What I have stated is the fact. When we find charges of this kind made by the President of the United States, surely I am .justified in repeating them.
– Does the President charge the Senate as a whole?
– No; he does it according to the article I am about to read. But President Roosevelt charges the Bar of America with being in the pay of trusts for the one purpose of defeating the laws passed by Congress. It is well known that the trusts of America have got such a pull on the Senate that, as I say, they can pass or defeat anylawthey wish. That is so well known to the readers of trust literature that it is scarcely necessary for me to make the statement.
– It is as natural as daylight.
– It is quite natural. President Roosevelt’s opinion is given in an article in the North American Review, under the heading “ Lawyers and Trusts.” I am sorry that the legal members of the Senate have taken flight for the time -being, because I think that what I am about to read would be of some interest to them. The article is written by Mr. Frank Gavlord Cook, and commences as follows : -
President Roosevelt, in his address at the Harvard Commencement last year, made a grave charge against members of the legal profession. “We all know that, as things actually are, many of the most influential and most highly remunerated members of the Bar in every centre of wealth,” he declared, “ make it their special task to work out bold and ingenious schemes by which their wealthy clients, individual or corporate, can evade the laws which were made to regulate, in the interests of the public, the uses of great wealth.” Coming, as it does, from such a conspicuous source, on such a prominent occasion, and with such earnest emphasis, this charge should receive the serious attention of the community and of the Bar. It deeply concerns the community, because, if true, it points to a combination of wealth and legal skill - little short of a conspiracy - against the public welfare, a scheme to defraud and despoil the public for private gain, and in defiance and contempt of the law. And it vitally concerns the Bar, because such employment by its members compromises its honour, reputation, and usefulness.
These are very strong statements made on the authority of the President of the “United States, and it does not require me to further labour the point. This all goes to show that the power of capital in the United States is such that it has been able so far to defeat any great alterations being brought about by anti-trust legislation. Whether our experience in Australia will be different or more successful than in America time alone can tell. However, I think that in Australia we have an advantage. Fortunately for this country, the Labour Party has obtained a footing in the various Legislatures, and that is more than can be said for the democracy of the “United States. The consequence is that the power of the trusts is much greater in America than I hope it will ever be in Australia.
– We are all in accord with that.
– I do not think that the Labour Party is any stronger in Australia because of Senator Mulcahy.
– Why discuss me when I agree with the sentiments expressed by the honorable senator?
– I am afraid that the sarcasm in the tone rather discounts the acquiescence of Senator Mulcahy. I am pleased, however, to hear that the honorable senator agrees with what I say, though the agreement did not appear from the tone adopted.
– It does not matter whether or not the honorable senator is pleased.
– I might return the compliment. I set myself the task of proving the existence of a shipping trust in Australia, and I think I have done so by the evidence I have quoted. I have proved that the operations of this trust are of a highly injurious character, so far as concerns other sections of the community, and, consequently, we have every right to legislate so as to minimize the evil effects of such a combination as far as possible. We have certainly got rid of the competitive system in the coastal trade, but the benefits so far have only reached the employers. By this combination the ship-owners have managed, up to the present, to reap all the advantages from the concentration of the trade with the Employers’ Federation.
– How does the honorable senator propose to affect the actions of the so-called shipping ring by this Bill?
– I would impose a similar law to that which is in vogue in America - the Elkin Act. We had evidence before the Navigation Commission that the rebate system has, to a great extent, been broken down in America by means of that law, and if we can follow the example thus set, we shall get rid, I hope, of a very injurious system.
– There are also the navigation laws of America.
– I hope that in due course we shall also be able to have proper navigation laws here, and I shall support Senator Guthrie in any action he may take with that object in view. Whilst in place of the old competition we have got the evil of private monopoly, I do not think that even if we get rid of the latter, we shall go back to the former system ; indeed, I feel sure we shall do nothing of the kind. The old, stupid, and wasteful system of competition is a thing of the past.
– Then this Bill would not affect it?
– I think the Bill would affect the old system to a considerable extent. At all events, I am satisfied that no matter what the result of the Bill may be - no matter whether it affects trusts to the extent of breaking them up or r.ot - we are not likely to revert to the old competitive system of industry. We are too civilized now to suffer the evils of competition.
– I thought this Bill was to bring about fair competition.
– If the Bill had that effect well and good, but so far as the old competitive system is concerned, with its accompanying waste in every trade, it must be regarded as a thing of the past. My remedy for the whole situation, in order that the benefits of the abolition of competition may be justly distributed, is the nationalization, of trusts, because that is the only remedy which would go to the root of the matter. So long as private companies and capitalists have the controlling power, the united profits of the concentration of capital will undoubtedly accrue to them instead pf to the people at large. Of course, we , naturally expect Senator Gray to dissent from such. a view, but ultimately we shall be forced to nationalize trusts or the trusts will control the whole of us. Trusts are gradually extending their power in the richest country in the world.
– Trusts will not control the whole of us while Australia has its present franchise.
– I dare say the franchise will prove an obstacle in the way ; but if the power of capital extends in Australia as it has extended in the “United States, we shall either have to nationalize the trusts, or the trusts will possess every interest in the country.
– We shall have to nationalize the Labour Party, I think.
– That is the national party now.
– I think the Labour Party may fairly and reasonably claim’ to be the national party. However,. I agree that there is no course open to us at this stage but to follow the course indicated by the Bill. I quite recognise that Australia is not prepared to go the length of nationalization; and that being so, we must make the best of the present position. This Bill undoubtedly gives us_the power, to some extent, to control the trusts now in existence. I should like, in conclusion, to repeat the words of John Stuart Mill, that no Government can divest itself of the duty to control monopolies for the public good.
.- I am inclined to think that the importance of the Bill has been somewhat exaggerated, but no words can over-estimate the complexity of the problem with which we have to deal. As I have thought on many occasions, we do not adopt the right mode of making laws for the Commonwealth. It appears to me that our system is not the one best calculated to insure wise laws, nor to make the most of such ability and experience as members of the two Chambers possess. The Bill is eminently one which might with great advantage have been referred to a Committee. I do not mean a Select Committee, but a Committee of the Senate composed of members of varied experience, who, sitting round a table, with authorities, precedents, and histories before them, would have been able to prepare a report most helpful in dealing with this complex problem, and in framing such laws as would bring about the result we all desire. That result is that trusts shall be fairly regulated, and dumping of an injurious kind shall to some extent be prevented. I quite admit that the evils of trusts in Australia have hardly yet appeared. The reasons I have for voting for the second reading, and thus getting the Bill into Committee, are two. First, I agree with the closing remark of Senator Playford, that, having an Act to deal with trusts and their regulation and control, we could to a very great extent prevent the mischief showing its head here; and, secondly, I am influenced by the statement of Professor Ely in his admirable book on the question, namely, that because we cannot see our way to do everything we might desi:e in the regulation of trusts so as not to injure our trade and commerce, is no reason for our not attempting to do something. For those two reasons I shall vote for the second reading of the Bill, but I am not prepared to vote for every clause. It is quite certain that there are beneficent trusts, and trusts which have injurious effects. Some writers tell us that trusts were created to put a stop to the waste of competition, it being seen that, by large organizations of capital and industry, economies might be effected which could not be brought about by single individuals. I think, however, that it will be found that human nature is at the bottom of most trusts, which really are formed and continued for the purpose of preventing competition. The Meat Trust, for instance, is one which appears to be based on selfishness and on virtual tyranny ; the members have done everything that dishonorable men - :for that I call them - with brains could do. They depreciated or appreciated the price of cattle) as suited their purpose, and tried to limit the output and regulate prices - in short, they acted in every way in restraint of trade in order to do away with what we call fair competition. Then the American Sugar Trust agreement is such that it is difficult to find a clause in it of which it can be said that it is illegal or ought to be made illegal. That trust was formed for a beneficent purpose, but at bottom there was a desire to get rid of competition. I have been rather amused by the utterances of Senator de Largie, and I think that when Senator Gray interjected the former gentleman found himself in rather an awkward position. We find the Labour Party supporting a Bill, the object of which is to do away with unfair competition and bring about fair competition - to base the industries of this Commonwealth on a fair standup fight between man and man. Senator de Largie must see that, in supporting this Bill, he is absolutely inconsistent in view of the principles he advocates.
– How does the honorable senator make that out?
– The fact will appear a little more clearly when I come to deal with the utterances of Senator Pearce, who made a most excellent speech, and gave us a good deal of information. Senator Pearce, however, fell into the same inconsistency as Senator de Largie.
– The honorable senator might give us some proof of his statement.
– Senator Pearce told us that these trusts are Che result of economic conditions, and that nothing could effectually stop them but the nationalization of industries. If Senator Pearce’s veryneat phrase that “ trusts are the result of economic conditions,” has any force in it - and I think it has - it is a half truth ; the honorable senator has left out, as the Labour Party always1 does, the factor of human nature. I do not think that the United States could hold anything like the position in the. world it does to-day - that it could not possibly have attained to the position of one of the first industrial nations of the world - unless there had been large organizations of capital. Such organizations are absolutely necessary to the progress, and nothing that we can do will ever stop them. All that we can attempt to do is to try and regulate them. I am quite sure that both Senator Pearce and Senator de Largie have been studying some of the excellent books in the Library, and that they must have come across passages which set forth in better language than I can command, the fact I am now trying to establish, namely that those large organizations are simply the result of the evolution of commercial and industrial life.
– They are stored up labour.
– “Stored-up labour.” The honorable senator is now repeating one of the fatal blunders of the Labour Party. He is speaking as if everything were done by labour - as if there were not such a thing as skill, as efficient labour as against inefficient labour, or any variability in human nature. This capital is not simply stored-up labour. On this point, I should like to read an extract from a book, Commercial Trusts, written by John R. Dos Passos, of the New York Bar, as follows: -
It is a cruel mistake, not to say blunder, to discuss these questions upon the lines of wiping out capital and exterminating it. It is as senseless as ‘-impossible. One more thought, and I shall close. In connexion with this crusade against aggregated capital, it is fashionable to cry out against individual wealth. There is not in the political history_ of this country any appeal so demagogic, unnatural, unfounded, and unsustainable, as that which is made against wealth. The instinct of envy, or the worst passions of prejudice, or demagogism and ignorance, lie at the base of such appeals. That you and I have not been fortunate enough to accu- mulate wealth, is no reason why we should undertake to criticise, and fmd fault with, those who have gotten it legitimately, much less to seek to deprive them of it.
I should ‘say that itf we do anything which unfairly or unwisely restrains trade or competition, the result must be very disastrous. Our object should be to arrive at the point where competition is fair and .where it is unfair. I think that another reason for trying to deal with this complicated matter is that if any party in the Commonwealth say that it is quite impossible to control trusts the Labour- Party will have a stronger ground for asking - “ Why not nationalize all monopolies ?” I have not yet heard a clear statement of what might be expected to happen when monopolies were nationalized. I attended the debate on free-trade or protection between Mr. Scott Bennett and Mr. Max Hirsch,, and I was never more surprised in my . life than when I heard the former declare that he had ‘ not considered how the nationalization of industries would operate, how the men working under a social regime would have to be paid, or in what proportions they would be paid. It appears to me that the Labour Party have not considered those points, because, under their policy,, it is almost impossible to arrive at any scheme which would do justice between man and. man, or which would not end in perfect chaos before the nationalization of industries had been in force” two or three months.
– Do not the .employes on the railways and in the postoffices get fair remuneration ?
– From the foundation of colonization in Australia the postoffices - and, since their introduction, the railways - have been worked by Government.
– They are justifiable State monopolies.
– Yes.
– Many years ago there were private railways in Victoria, but they were bought by the State.
– My honorable friends cannot get out of the dilemma by arguing in that way. The only argument they have to fall back upon is, “ Look at the post-offices .and railways.” I am speaking of industries which have never, been managed by the Government, but which ought to be, and must be, carried on by private enterprise. I am not going to allow my honorable friends to force down my throat the argument about the railways and post-office’s. Those institutions are carried on for the benefit of every class in the community; therefore, they ought to be under the control of the Government. My honorable friends might nationalize one industry, and not be able to observe the defects of the system, except in the creation of a few more public servants. If we nationalize all industries which are monopolies, or if we nationalized all the means of production, distribution, and exchange, it would create disaster, and that is the policy of the Labour Party. There are a great many precedents, however, to justify us in trying to regulate trusts. I find that in Austria, so long ago as 1870, it was illegal to raise prices above the market value; that in America there are sixteen States where it is a criminal offence to regulate prices, six States where it is a crime for two or more persons to enter into an agreement whereby full and free competition is prohibited, and one State - Nebraska - where it is an offence for two or more persons to agree to suspend the sale of a product. We know that since the passing of the Sherman Act fifteen Acts have been passed in the United States to regulate trusts and monopolies. Therefore, we are quite justified in doing what we cao to pass a Bill to suit Australian conditions. In the first place, the Bill bristles with legal points; and I believe that two clauses are ultra aires. It will be observed that the following words in sub-clause 1 df clause 4 - in relation to trade or commerce with other countries or among the States - are left out of the first sub-clause of clause 5. That is done because the latter deals with foreign corporations. It is contended” that, because the phrase “ foreign corporations “ is used in paragraph xx. of section 51 of the Constitution, Parliament’ has power to deal with foreign corporations in any way it likes, and that,’ although we can, only regulate trade and commerce between the States, we can regulate trade and commerce under foreign corporations in one State only. That is, I think, illegal. I do not conceive that that was the purpose for which that power was taken in section 51. I am inclined -to agree with Senator Drake that in legislating with regard to foreign corporations, we have to deal with such questions as their formation, their capital, and so forth, The same argument arises in connexion with clause 6. It says -
For the purposes of the last two preceding sections, unfair competition means competition which is unfair in the circumstances; and in the following cases the competition shall be deemed to be unfair unless the contrary is proved : -
If the defendant is a Commercial Trust.
It is to be taken for granted that there is unfair competition if the defendant is a commercial trust.
– If he cannot prove the contrary.
– Some honorable senators have denied that if it be a commercial trust, and if prima facie that is to be evidence of unfair competition, the Minister would have to prove all the things stated in clauses 4 and 5, namely, the contract or combination, the intent-
– Does the honorable senator say that it would be necessary to prove that the defendant was a commercial trust ?
– Certainly. The only thing which the phrase “ commercial trust,” would save the Minister from proving, is that it was unfair competition. It would still be necessary to prove the contract the intent, and that it was an Australian industry worth preserving.
– Is not unfair competition the whole gravamen of the thing.
– Whether that is so or not, certain things are laid down in clauses 4 and 5, all of which, with the exception of the unfair competition, would have to be proved. For instance, it would be necessary to prove that the man had imported the goods with the intent to bring, about unfair competition or to destroy an Australian industry, or that the preservation of the industry was to the advantage of the Commonwealth.
– If he was acting unfairly, it would be necessary to prove that he was intentionally doing so.
-If the defendant were a commercial trust, it would be necessary to prove all the things mentioned in clauses 4 and 5, with the exception of the unfair competition.
– The intent would be proved by the way in which the thing operated.
– My honorable friend is taking a very shortcut in order to get out of a difficulty. I quite agree with him that when certain things were done and there was a natural, clear result flowing from the act, the Court would deem that to be evidence of the intent, tout it would be necessary to prove that result. I do not mean to suggest that it would be necessary to stand up like the International Harvester Trust, and say that, having got 90 per cent, of the world’s trade, it was going to get the other 10 per cent. But if the importation of the goods and the competition which was brought about was unfair, and certain other consequences followed, the intent would be assumed. But that would have to be proved according to the law of evidence. Clause 6 goes on to say -
Senator Pearce dealt with that part of the clause. I am sure that he feels, as I do, that here we are touching upon very delicate ground. It has been understoodall along that the Commonwealth has nothing; to do with the industrial life of the people of the States, that all legislation as to factories is left to each State, and that even if we desired, we could not possibly have a uniform industrial law.
– What about the Conciliation and Arbitration Act?
– That only refers to industrial disputes extending beyond the limits of one State.
– The honorable senator said that we have no right to deal with certain industrial questions. He made no concession at all.
– We have no right by a side wind to attempt to deal with the rates of wages or the hours of labour in the different States. Under our authority to regulate trade and commerce between the States we cannot deal with such questions. Those clauses, 5 and 6, appear to me to be ultra vires.
– In some businesses we can.
– I do not think that it can be done there. In dealing with the question of dumping, we are venturing upon more delicate and dangerous ground than ever. According to my reading, the United States have a magnificent home market of 80,000,000 persons, and it is protected with the highest Tariff wall in the world. The manufacturers keep their factories and men working at full speed from’ the 1st January to the 31st December. They make such an enormous profit in their protected and .magnificent home market that they can afford to dump their surplus down in other countries, and1 take almost any price for it. That is the kind of dumping- which I think we ought to try to prevent. When Australians go to England or maintain there smart agents who understand what our markets are, and buy the surplus of the season’s goods in London and ship them out at a very low price, I do not call that dumping, but competition - the very competition which the Bill is meant to create and put on, a firm basis. I admit that it is almost impossible to draw the line between unfair and fair dumping, and there comes in the complexity of the problem with which we have to deal. I am very much interested in the amendment of which Senator Symon has given notice, because, as I understand, he proposes to except the importation of goods from Great Britain^, I do not know what course the Government intend to take.
– We are going to oppose the amendment, of course.
– The Government declare that they are in favour of preferential trade, and here is an, opportunity to deal with preferential trade..
– Preferential dumping.
– To some extent it would give a preference to Great Britain. No one can contend that the dangers arising from., and the illegalities of, the trusts in Great Britain aTe a thousandth-part of those of the trusts in America. Is not that a reason for making an exception in favour of Great Britain? I defy honorable senators to draw a comparison between the importation of a quantity of last season’s London goods at cheap rates and dumping, because countries like America make goods to sell at an absolute loss. We know that in almost every case thev take less for the goods thev export than, notwithstanding the cost of transport, they can get in the home market. The latter is the kind of dumping which we ought to try to regulate or exclude if possible. On this subject Senator Drake pointed out a matter which I think very much ‘ detracts from the usefulness of the Bill, and that is that ive cannot discriminate between State and State. If it be found that goods are being dumped into the Commonwealth, their importation must be prohibited. The Justice or the Government might consider only the circumstances of the State in which the dumping occurred, consequently the Minister might prohibit the importation into the Commonwealth of goods which two or three States most urgently required. He might prohibit the manufacturers in those States from getting, perhaps, some of their raw material in the shape of partly madeup goods, and thereby do infinite harm to the trade of the Commonwealth. I am at “ a loss to understand how we are to frame clauses which would do exactly what we desire. The progress of the Commonwealth must depend upon the free play of competition, with very few exceptions. It must depend upon every man being allowed to do the best he can for himself, and to use has brains and capital in the best possible way, and the exceptions must be when unfairness has crept into the competition. The difficulty, however, is to say how the unfairness is to be determined, and to discriminate between it and what is really fair competition and fair trade.
– That would land the Commonwealth in a state of anarchy.
– Nothing of the kind. It must be borne in mind that there are scores of things which create hardship. If, however, we attempted to regulate those things, we should stop the progress of mankind. We all know what great suffering was brought about by the introduction of machinery. On the whole, sewing and other machines have done good to the world, but at the same time they have caused infinite suffering to hundreds, nay, thousands of men and women. In the same way, on the whole the aggregation of capital in large trusts has its good, as well as its bad side. Too much time is, I think, being devoted to the debate on the second reading of this Bill, but if it gets into Committee I shall be prepared to do my share of the work in dealing with its various clauses.
– I join with Senator de Largie in congratulating the Senate upon the highly intelligent and learned way in which the subject-matter of the Bill has been discussed. We are dealing with a most complex question, and it will be no reflection upon the Seriate, I think; if I suggest- that it is being dealt with in a most complex way. The most able speeches which have been made have certainly been against the Bill. Only Senators Trenwith, McGregor, and Best have really spoken in its favour. The able speeches have been made by those who are strongly opposed to the Bill, and who do not believe that it will do any good, but who are, all the same, going to vote for it. It seems to me that it would be just what one might expect from the tone of the debate, and the action of honorable senators, if Senators Millen and Pulsford were to vote for the Bill, as Senator Dobson, who has just condemned it right and left, has announced his intention to do. I do not propose to support the Bill, because I do not believe that it would accomplish what most of us desire. While I give the Government credit for anticipating a state of things which might arise - not so badly in Australia as perhaps in other countries - I do not think that this Bill would accomplish the purpose for which it has been framed.
– If the Government would propose legislation dealing with matters here and now, and not for the dim and distant future, we could understand their policy.
– Do honorable senators really think that this Bill will achieve the results that we desire?
– Let us try it.
– I should be glad to try it if my common-sense did not convince me against it. The question of trying to prevent monopolies is nothing new to me. Although Senator de Largie was disposed to sneer at an interjection that I made, if he looks up the records of Tasmanian politics, he will find that in our small State there has been no stronger enemy of local monopolies than the senator who is now addressing himself to this Bill.
– Tasmania is the home of monopolies. What about Tattersalls ?
– I never address the Senate and mention Tasmania without Tattersall’s being dragged in.
– It is a great blot upon the State.
– If it is a “blot “ I have never been ashamed of it. It has always appeared to me that Tasmania has shown her strong common-sense in regulating what we all know it is impossible to prevent.
– I hope that the honorable senator will not be led astray by irrelevant interjections.
– In addition to being an anti-monopolist, I am also a protectionist. I believe in doing all that we can by legislative means to encourage production and manufacture in this great country. The possession of a country with such an enormous territory, such varieties of climate, and such vast resources, warrants us in doing everything possible to make it self-contained and self-supporting, providing all that we need within our own borders. There are various ways of accomplishing that purpose. The method that I prefer is the honest and straightforward one of imposing Customs duties on goods such as we can manufacture for ourselves.
– Does the honorable senator mean prohibition?
– No, I mean a reasonable Tariff that will give the Australian manufacturers a fair “show” against outside competition. It may be that high duties will be necessary at the start to enable manufacturers to overcome the initial difficulties. But if the goods came in we should derive revenue from them, and they would be imported in decreasing proportions if we had reasonable protection. Although a protectionist, I am not a prohibitionist ; I am a believer in protection on common-sense lines. I do riot believe in protecting small and insignificant industries. We should deal with the matter in a statesmanlike way, selecting those large industries that will give employment to hundreds and thousands of people, and which are worthy of consideration by Parliament by reason of producing a raw material from the use of which will spring larger manufactures. For that reason I am in favour of protection for the purpose of establishing the iron industry on a firm foundation. I have already said that the Bill is very complex. It is complex because it tries to deal with two things, one of which is really opposed to the other. Strange to say, however, one is very often the result of the other. By means of this: Bill we are going to try by the one measure to kill competition and monopoly. Can we do that by one Act of Parliament? I intend to deal with the measure as a business man who knows something about importing, and to point cut. the difficulties that we have to face. Here I may say that there has been a tendency in our recent “legislation to try to do things that are difficult of accomplishment, and at the same time to hand over too much arbitrary power to the Minister. That practice should be guarded against, and when the Minister is endowed with large powers, as he must be under such a, measure as the Customs Act, he should be scrupulous in exercising them with discretion. Under various Acts, we have given enormous powers to make regulations. The worst feature of this procedure is that there seems to be a disposition to abuse those powers, even to the extent of providing by regulation for something that is unconstitutional, or, at any rate, for something that seems to me to come very near to the border line of unconstitutionality. I am not accustomed to make charges against the Labour Party, but in this respect I must say that there is from time to time a tendency manifested on their part to try to exercise powers which the Constitution has not conferred upon us. When I was speaking in favour of Federation before my constituents in Tasmania, I told them that in everything which was not handed over to the Commonwealth the sovereignty of the States would be preserved. When I see this disposition to assume powers not given to us by the Constitution - as, for instance, when it is proposed by the Labour Party to impose a land tax in order to break up large estates-
– Does the honorable senator think that the Labour Party and its proposals have anything to do with this Bill?
– I am giving an illustration of the straining of our constitutional powers.
– Nolegislation with regard to land is proposed in this Bill.
– But there are proposals to do certain things that, in my opinion, are not constitutional.
– The Constitution does not say that we shall not impose land taxation.
– The members of the Labour Party should be amongst the strongest upholders of the Constitution because it was adopted by the votes of the people.
– When Parliament does anything unconstitutional, the High Court will pull us up.
– We should do nothing to give the High Court cause to pull us up. There is a proper way to alter the Constitution, if it is desired to assume further power, and we should not endeavour to attain our end in an indirect way. This Bill gives an instance of what I mean. In certain of its provisions we endeavour to deal with hours of labour and conditions of employment.
– That is one of the best features of the Bill.
– The Bill has been drafted by a very astute lawyer, and it seems to me, speaking as a layman, that he has tried to get outside the boundaries of the Constitution in an indirect manner. I totally disapprove of, and shall vote against, any such proposal. When we are dealing with Bills of this character, and representations are made to us by bodies such as Chambers of Commerce, or associations or merchants, we are, I am afraid, apt to treat them very lightly.
– We do not.
– There is a tendency to do so, and I do not think thatit is justifiable. We should not assume that every man in trade, every importer, every merchant, belongs to a dishonest class, if indeed he is not personally dishonest. We should listen with the greatest respect when men of known integrity, whose characters are above reproach, meet as members of Chambers of Commerce, and make representations to us. I have tried to obtain the opinion of one or two business men regarding this Bill, and wish to read a short extract from a letter from one of the largest warehousemen in this city - a man whose record is absolutely above reproach, a law-abiding, good specimen of the British merchant. He says -
As to monopoly, it is a common thing, in order to avoid undue and unfair competition, for manufacturers to select one or more houses in each State with whom to do business. Although competition with goods of a similar character prevents an inflation of prices, and so prevents detriment to the public, such a method of business would not be allowed under the Bill -
– Who says so?
– The Bill says so.
– It says nothing of the kind.
– The honorable senator might as well listen to the context of the letter - as the contracting parties would constitute technically a commercial trust. My firm was approached last week by the representative of a firm of manufacturers giving us the option of being one of four firms who should receive consignments of goods which compete with Australian production, but the condition laid down was that each of the four houses should bind themselves not to sell at less than a given price.
– That is restraint of trade.
– It is done beneficially every day of the week, and honorable senators are aiders and abettors of it. All those who buy Jaeger’s underclothing are aiders and abettors of the practice, for that material is the subject of a monopoly, and cannot be sold for less than a certain price. That practice is adopted for the purpose of assuring fair competition and fair profits.
– If the practice is to the detriment of the public, it will be affected by this Bill; if not, it will not be affected by it.
– It is very easy for the Minister to say “if” such and such is the case the Bill will operate, and “if” it is not the case the Bill will not. But what is meant by some of the terms used in this Bill? What, for instance, is meant by “ detriment of the public”? Who are the “public” in this regard? The letter from which I quote goes on -
This would manifestly prevent unfair competition with the Australian production ; but we are precluded from entering into such an agreement, because we should become a commercial trust by reason of a common agreement.
– A commercial trust does not come under the purview of this Bill unless it does something injurious to the public.
– The Bill says that a commercial trust shall be prima facie evidence of unfair competition.
-The honorable senator who introduced this Bill does not seem to understand what it means. Senator Pulsford proved quite clearly last week that the very existence of a trust ipso facto is to be accepted asprima facie evidence of unfair competition under the Bill. Another feature that strikes me is the want of proper definitions. Terms are used, and we are not told what we are to understand by them. The letter from my friendproceeds -
In order to understand the effect of this Bill, two of its terms need to be clearly defined without any vagueness or ambiguity, namely, the words “restraint of trade” and “detriment of the public.” If it is to the detriment of the public to pay a higher price than could otherwise be charged, then this Bill, by destroying competition, compels traders to trade to the detriment of the public. We are on the one hand compelled to have regard to the interests of the buying public, but in doing so, any common agreement between two or more separate traders to sell at such a price as will give reasonable remuneration to all concerned in the production and distribution of the goods, becomes an indictable offence under the Bill.
Every one must recognise that in the Bill the Government is trying to do two things that are entirely opposed. Again, what is meant by “Australian industry” ?
– I should imagine that the honorable senator would be able to answer that question.
– But what constitutes an Australian industry under the Bill? Isit an industry employing 10, 100, or 1,000 people?
– We have a tribunal to decide those questions.
– When Senator Playford replies, I should like him to tell us what the draftsman of this Bill considers to be an Australian industry, because the term, if left undefined, will, probably lead to different definitions being given in different places, and to an unequal administration of the law.
– I think the High Court will manage that all right.
– But there is an appeal from the High Court to the Minister.
– Surely not.
– Yes, in the dumping clauses. The Government would do better to withdraw the Bill, and reintroduce it with alterations. It will be no credit to them.
– If we do not have a Bill of this sort, it will be found that the people of this community will go in for nationalizing these monopolies.
– Now we know.
– How do our labour friends like that?
– Now we can understand what the object is - to “dish” the Labour Party.
– Oh, no.
– The object is to prevent the policy of the Labour Party being carried out.
– The climax is gradually arriving. To make the inconsistency more inconsistent the Labour Party, one and all, ought to vote against the Bill, bearing in view its real object, which has just been confessed by the Minister.
– The Labour Party are going to vote for the Bill, because it is intended to stop nationalization !
– I do not intend to deal fully just now with many matters which can be more properly discussed in Committee. I should like, however, to say a few words on the question of dumping. First, I desire to know whether it is intended to apply the restrictionslaid down in the Bill to all varieties of imports, or whether certain imports are to be selected, and, if so, on what principle the selection will be made? There seems to be some difference of opinion as to what constitutes dumping. According to the Bill, the importation of any goods which have been bought at a price under thecost of manufacture is to constitute dumping.’’ Apparently, it does not matter under what circumstances such materials or goods are bought - if they are bought at a price which is under the cost of manufacture, their importation will constitute dumping. The Bill provides that the competition shall be unfair -
If the imported goods have been purchased abroad by or for the importer, from the manufacturer or some person acting for or in combination with him or accounting to him, at prices greatly below their ordinary cost of production where produced, or market price where purchased :
If that provision is given effect to it will practically stop the importation of a vast quantity of goods which it is very desirable that we should have. I have the strongest objection to Ministers informing us, either in Parliament or by means of some publication, that Bills we pass are not going to be administered in a certain way. Here, for instance, is a statement, published by the authority of the present Minister of ‘ Trade and Customs, relating to the Commerce Act -
With reference to paragraph 3 above, and similar paragraphs in other sections, it may be observed that it is always the practice of the Department to take a lenient view of any case, and that the Minister would not sanction any attempt to unduly enforce the law to the disadvantage or loss of innocent importers. The surrounding circumstances will always be taken into consideration, and only such evidence will be required as to want of knowledge or intent as should satisfy any reasonable man. It is hoped that it will seldom be found necessary to enforce forfeiture or to prosecute for fine.
– That is very good of the authorities, is it not?
– It is very good of the Minister of Trade and Customs; but what does the assurance amount to? It means that the Minister of Trade and Customs, after the passing of a Bill, announces that he is not going to do what the Bill says he shall do.
– It means that a Bill will not be administered in an arbitrary or harsh manner.
– Senator Playford and the other members of the Government can only speak for themselves ; they cannot hold office for all time.
– But we believe in the common sense of any gentlemen likely to hold office.
– The present Minister of Trade and Customs might be succeeded by a man with very arbitrary ideas.
– Then he would not be Minister long.
– It is quite imaginable that a certain Mr,. McKay, who is a maker of harvesters, might become a politician, and hold the office of Minister of Trade and Customs, and he might be found to possess very strong views with regard to the importation of certain goods. We know that in business it is the practice, at the end of the season in the old country, to clear out large stocks of goods at low prices. Our season and that of Europe fit in so nicely one with the other that we here are able to make use of stocks which otherwise might prove of great disadvantage to manufacturers, merchants, and tradesmen at home. This is particularly the case in regard to fashionable goods, prepared, it may be, for a summer which turns out to be of a severe nature, or goods may have been manufactured for a certain fashion which has not caught on.” This presents an opportunity, which isvery properly taken advantage of by business men, bearing in view the fact that the fashions in Europe are the basis of our fashions in Australia.
– Does the honorable senator think that in this respect Australia will never get ahead of the old country ?
– It will be a long time before Australia gets ahead of Europe in the matter of fashions; as a matter of fact, even the fashions in the United States are entirely based on those of Europe. Such goods as I have indicated are sometimes bought in very large quantities, and at very low cost, at the end of a season, and one purchaser may be more lucky than another in securing a considerable stock. Under the Bill, however, a lucky buyer of the kind would, on importing the goods to Australia, be liable to have a complaint made against him under the Bill, on the ground that he had purchased the goods at a price greatly below their ordinary cost of production, or below the market price in the country of origin. In some cases, the marketprice may be 100 per cent., or even 150 per cent., higher than that paid by the representative of the importer; but under the Bill the goods could not be sent to Australia without the risk of punishment at the instance of dissatisfied competitors.
– Not unless the competitor were an Australian manufacturer.
– There must be Australian competitors in such a case.
– Then they ought to have consideration.
– They ought to be protected against dumping.
– And so they will be considered. The manufacturers themselves are often importers too, and introduce goods to copy the patterns and fashions, and sometimes, under the circumstances, they find it better to bring them in and sell them. On the question of intent, the lawyers have taken opposite views. To me, there is no doubt that “ unfair competition “ has, in all cases, reference to an Australian industry, the preservation of which may be deemed to be advantageous to the Commonwealth; and in the clause I have already read, we are told that competition shall be deemed to be unfair if the imported goods have been purchased at a price below the ordinary cost of production, and so forth.
– According to the Bill the competition is unfair if the man who makes similar’ goods here does not get enough profit.
– If a man has been fortunate enough to buy at a low price a large stock of jackets or mantles in the old country; and he imports them to Australia, will he not be guilty of unfair competition with intent, in the event of his being able to compete successfully against other traders in Australia? Surely, if a man is proved guilty of unfair competition, it will be assumed that he had the intent to unfairly compete.
– There would be the intent, at any rate, to undersell the other man.
– There must be the intent to injure or ruin the Australian manufacturer.
– If to undersell is unfair competition, will the intent not be established by the act itself? I think we should help our producers and manufacturers, but we ought to help them in an honest and straightforward way.
– That is what the Bill will do.
– Our business men would then know where they were, and not be subject to harassing interference at the hands of Customs officers, who must very often find it difficult to do their duty, owing to want of knowledge. This Bill is either going to impose an enormous amount of work on the Customs authorities, or, as I predicted of the Commerce Act, it will be a dead letter.
– And a nuisance.
– The Bill will either be a nuisance and embarrassmentto business men, and will be very soon removed from the statute-book, or it will be a dead Act.
– But the Minister tells us that the Bill will stop the nationalization of industries.
– That is a point on which the Minister, I Rave no doubt, will presently have to render an account. I intend to vote against the Bill, for the reasons I have indicated. We have already placed very heavy obligations on importers, who have to instruct their Home buyers to describe a large amount, of the goods sent out. If the buyer at Home desires to know what sort of description he shall send, the importer is not able to tell him; it is an absolute truth that the importer cannot inform his buyer or agent what he is expected to describe, or how he is to describe it.
– If the buyer described his goods truthfully there would be no trouble.
– The latest proposal is that buyers and agents at Home are to ascertain the actual cost of production, and the market price of goods they send out ; they are to be forbidden to buy any article below the market price at Home, if that article happens to be manufactured in Australia. I shall vote against the Bill, because I believe it will prove impracticable and ineffective, and do more mischief than good.
– I regret that I have not been able to attend and listen to the speakers who have preceded me; but I can say that I have carefully read most of the speeches. I twice read the speech of the Minister of Defence in introducing the Bill, believing that he, at all events, would do his best to place clearly before honorable senators the object of the proposed legislation. I confess, however, that I got no satisfaction from the speech of the honorable gentleman; I got no knowledge from his utterances as to the reason why this Bill has been introduced.I regard this as one of the most important measures ever submitted to the Senate, because it introduces a new principle into Australian business, as that business has been conducted for the last 100 years. I had thought that a measure of such far-reaching consequences, and involving so great a departure from commercial practice, would have had very strong reasons behind it ; but I find no reasons beyond the action of some American or Canadian agricultural implement importers. This afternoon we have had an explanation from the Minister, by way of interjection - an explanation which, I am sure, will be read with surprise throughout Australia - to the effect that this Bill has been introduced in the belief that it will prevent future attempts at the nationalization of industries.
– Oh. no, no !
– That is what the Minister said.
– If that be the object of the Government they will receive a kudos not enjoyed by them since they took office.
– The honorable senator ought to vote for the Bill ! But that is not what I said.
– I am now only endeavouring to put the Minister’s view before the Senate. We have always understood hitherto that the present Government was kept in power and was dominated by the Labour Party. Some of us really believed that this Bill was introduced because it was thought it would please the Labour
Party. Now, however, we find the Ministerfrankly stating that one of the objects of the measure is to help to kill the movement for the nationalization of industry.
– The honorable senator misunderstands.
– There is nomisunderstanding; the Minister made a plain statement of fact.
– The statement I made was that the chances were, that if we did not pass a Bill to regulate trusts, in course of time trusts would grow, as in America, and then we might have to nationalize industries.
– What the Minister said was straightforward and simple, and I am afraid that it will take him a considerable time to “ get round the” corners of it.”
– I do not want to “ get round the corners.”
– The real reason for the introduction of the Bill was that the Minister of Trade and Customs had poured into his ear, bya local manufacturer of agricultural implements, a tale of woe. I venture to say that the statements which Mr. McKay made to the Minister of Trade and Customs, and which I believe were the principal cause of the introduction of the Bill, were absolutely untrue, and absolutely deceitful. My leader, in the course of this debate, said that he believed that Mr. McKay only did what other people would have done; but I can scarcely think that is the construction which he would like to have placed upon his words. In my opinion, the manufacturers of Australia are above doing what Mr. McKay did. Whether free-traders or protectionists, they will fight as hard as they can in the interests of their own particular business and of the Commonwealth; but they will not “hit below the belt.” When the Minister found’ out that he had been deceived by Mr. McKay he should have done justice to business men who, far away from Australia, had had their characters impeached. I believe that the Minister of Defence said here that Massey Harris and Company should have every opportunity afforded to them to defend the position which they have taken up.
– I have never mentioned Massey-Harris and Company nor the International Harvester Company in connexion with this Bill.
– I apologize to the honorable senator, who, I understood, had made that statement. At all events, the Minister of Trade and Customs, who introduced the Bill into the other House, made that statement, but to this day he has not given the company a chance of vindicating its character or justifying its statements. When the company took the matter to a Court, he pleaded a technical point that as Minister of Trade and’ Customs he could do just as he liked. But I am very glad to say that the point was overruled. If a firm were to do in its business capacity what ‘that Minister has done in connexion with the Massey-Harris Company, I venture to say that . Senator Playford would use very strong language indeed, in regard to the firm which had caused all the hubbub’, which by its action was seeking to change the conditions of trade and commerce in Australia, and, so far as it could, attempting to stop the importation of other manufactures by getting placed upon the Tariff a duty which would be absolutely prohibitive.
– This Bill has nothing to do with the Tariff.
– It has everything to do with the Tariff. I am surprised to learn from that interjection that the Minister has not read the Bill or the debate thereon in the other House.
– The Tariff is not mentioned in the Bill.
– From beginning to end the Bill is really a prohibitive Tariff. Although the Minister of Trade and Customs knew that a report from the Tariff Commission - a body composed cif expert, ible men, who have done credit to themselves and to the Commonwealth - would be forthcoming in the course of a week or two, still he went behind its back and brought in this Bill. I cannot understand the reason which actuated Ministers in taking that course, unless they wish to use it as a propaganda, cry, this being, in my opinion, one of the worst symptoms which have been developed in Australian industrial and commercial life. I allude to the cry of “ Australia for the Australians.”
– HeaT. hear. A good Cry, too !
-“ China for the Chinese,” “ Fiji for the Fillans.” “Germany for the Germans.” Evidently that is the cue to this Bill. It is one of the most barbarous cries which have been raised, and one of the most unchristian doctrines which have ever been preached in the Commonwealth.
– I thought the honorable senator said just now that the Bill was introduced by the Government in order to please the Labour Party ?
– I did not say that.
– The honorable senator implied it, though.
– I said that the Labour Party dominated Ministers, and that the Minister of Trade and Customs brought in the Bill with a full knowledge that it would be favoured by that party.
– He did nothing of the kind.
– I do not believe that the Labour Party were ever consulted in the matter.
– Another reason which has been given for the introduction of the Bill is that in America trusts, monopolies, and combines, which have existed for a number of years, have been directly and indirectly administering their affairs to the detriment of the people of the country. It is urged that what has happened in America may happen . here.
– They started them.
– So far as I know, America has been an exceptional country, at all events, during the last seventy or eighty years, in regard to its administration of affairs. We know that in several cases the Judiciary has been corrupt.
– Not the Federal Judiciary. It has never been corrupt.
– I am speaking of what has taken place in the States of America. We know that in many cases Judges have been corrupt; that in almost every field of commerce there has been a percentage - not a large one, ‘perhaps - of cases in which business transactions in their widespread ramifications, have not been to the benefit of the people of the country. This maladministration has been going on for years.
– It is the big trusts in America which are the foundation of all the corruption.
– Speaking of the stale of America as it was forty years ago, Charles Dickens said -
Did I recognise in this assembly a body of men who, applying themselves in a new world to correct some of the falsehoods and vices of the old, purified the avenues to Public Life, paved- the dirty ways to Place and Power, debated and made laws for the Common Good, and had no party but their Country?
I saw in them the wheels that move the meanest perversion of virtuous political machinery that the worst tools ever wrought. Despicable trickery at elections; underhand amperings with public officers; cowardly attacks upon opponents, with scurrilous newspapers for shields, and hired pens for daggers ; shameful trucklings to mercenary knaves, whose claim to be considered is that every day and week they sow new crops of ruin with their venal types, which are the dragon’s teeth of yore, in everything but sharpness; aidings and abettings of every bad inclination in the popular mind, and artful suppressions of all its good influences; such things as these, and, in a word, Dishonest Faction, in its most depraved and unblushing form, stared out from every corner of the crowded hall.
Did I see among them intelligence and refinement, the true, honest, patriotic heart of America? Here and there were drops of its blood and life, but they scarcely coloured the stream of desperate adventurers which sets that way for profit and for pay.
It is the game of these men, and of their profligate organs, to make the strife of politics so fierce and brutal, and so destructive of all selfrespect in worthy men, that sensitive and delicateminded persons shall be kept aloof, and they, and such as they, be left to battle out their selfish views unchecked. And thus this lowest of all scrambling fights goes on, and they who in other countries would, from their intelligence and station, most aspire to make the laws, do here recoil the farthest from that degradation.
– That is the antiSocialist party in the United States.
– I am only pointing out that forty years ago the condition of America was practically as bad as it is to-day. We all know that the Tammany Ring in New York is the most unblushing and corrupt municipal body on the face of the earth. We know that even in saintly Boston and in San Francisco there has been municipal corruption. We are also aware that in some cases the State Legislature lias been anything but what we should expect a State Parliament in Australia to be. The fact that legislation has been enacted in America to meet such cases affords no reason why we should copy the example “there set. Are there in Australia any industries which, administer their affairs in such a way as is done in America? Can the Minister cite any law which has been enacted in England or any other country because in America, maladministration has taken place? We Rave known Justices who have not conducted* them-selves as thev ought to have done, but that does not justify the enactment of a special law. Let us consider what extensive powers are given to Railway Commissioners by the States. The Commissioners “ may “ misuse their powers, but the Government and the Parliament trust them. So it is in regard to our Judiciary. There is no sign that we in Australia are influenced by the bad traditions of America. I desire to make a short reference to the results of the Tobacco Monopoly Commission, on which I sat. In the first place, I wish to express my great pleasure at the manner in which its chairman, Senator Pearce, conducted the inquiry. He acted not only with ability, but with an impartiality which I hope will be imitated by the chairman of every other Commission. Now, so far from the Tobacco Monopoly Commission eliciting any evidence of maladministration, I venture to assert that there are few large business undertakings which could have gone so successfully through such an ordeal as the British Australasian Tobacco Company did. The evidence given on its behalf showed the existence of a healthy business spirit. So far as that combine is concerned, there is not an atom; of evidence which can be quoted as a reason why this measure should be brought forward. It was the duty of the Minister, if it existed, to submit evidence of maladministration by large business interests in Australia, to justify the necessity for such legislation as is proposed.
– What does the .honorable senator think of the operations of the shipping ring? Does he agree with them?
– I confess that I have not had time to go through the evidence in connexion with the shipping ring. This afternoon the honorable senator has made statements pointing out that there is a combine, and that in certain directions, perhaps, it has acted unfairly. But I, as a business mam, have not heard of any large amount of injury which is being, done to any of the trading interests in Australia. I have not heard a complaint that the combine has conducted its operations to the injury of the public generally, or to the discomfort of passengers. The absence of a complaint of that kind must, I think, be taken as an indication that it is conducting its business in a legitimate and healthy manner. I admit that, as a matter of fact, it has the power to do a large amount of injury ; but that remark might be made in respect of all combines. The shipping combine is purely a business concern, managed by experienced men, and carried on for a profit ; and the managers know perfectly well that if they were to exceed the limit of commercial “fair play their action would recoil upon the combine itself. In the same way, the British Australasian. Tobacco Combine knew very well that if they were to conduct their business in a manner which would be detrimental to the public, that if they were to use their powers in order to squeeze the consumers, the people, through their representatives, would let the fact become known, and that there would then be just ground for the Parliament taking, action with a view to regulate the tobacco industry. I cannot understand the argument of some persons that combines and trusts, because they are such, must be going to do something which is unjust. It has been proved up to the hilt that in America, trusts which have been administered with business knowledge have been merely combinations of firms to buy in the cheapest market with the largest amount of capital, and thus be able to sell goods at less than the ordinary business man can. Those trusts which have been conducted on equitable lines in America have been successful, and very nearly every trust in America which has used its powers for the purpose of squeezing the public has gone to the wall.
– No. They are the strongest in America to-day. For instance, there is the Standard Oil Trust.
– I wrote a letter to a gentleman who is one of the largest merchants and manufacturers in the United Kingdom, and who has written a pamphlet on that very point. Unfortunately, I have mislaid my copy of the pamphlet, in which he gives details of every trust of any size in America, and shows the absolute truth of my statement. I do not say that there are not trusts now which are using their power to the injury of the public. But I submit that, where there is one trust of that kind which has been successful, there are a dozen trusts of the other kind which have been successful, and that is only in accordance with natural law. In Australia, with its small population, business men in combines or trusts would be absolutely foolish to misuse their powers in regard to the public with a full knowledge of what the effect upon themselves would inevitably be. There is not a scintilla of evidence to show that such a Bill as this is necessary in Australia ; not an instance has been quoted of any trust misusing its powers here.
– Then it would do no harm to put it on the statute-book.
– My objection to it is that it would revolutionise the commerce of Australia. There has been no demand either from working men or from the: commercial classes for such a measure, and there is no reason for making an entirely new departure in regard to our business relations. The Bill cannot in any way promote the development of Australia from a commercial point of view. The cry “Australia for the Australians “ - likethe cry “ China for the Chinese,” or “ Fiji for the Fijians “ - is one that, in my view, absolutely takes us back to the old days of barbarism. Let us notice how our policy is regarded in Japan. A Victorian gentleman who has just returned from the East gives the following testimony : -
Mr. Jeffries believes that Japan is straining the cord of alliance with Great Britain almost to breaking point, but adds that the Japanese assert that there is no menace to Australia, as the alliance has been consummated. Speaking of trade, he says Australian produce is practically unknown in Japan; further, that the feeling is so intense against Australian exports that they are condemned because labelled Australian.
That is one of the results of the cry “ Australia for the Australians.”Cannot honorable senators realize that Australia, with its enormous possibilities, and its vast area, should aspire to be a great export manufacturing country ? How can we achieve that end when we raise barriers to prevent the nations of the earth from importing their goods? Do honorable senators suppose that the Japanese, the Chinese, and other people are fools?
– We have barriers raised against us in France, Germany, Austria, Italy, and almost all other countries of the world.
– The honorable senator does not know the A, B, C of business if he makes a statement of that kind. Is he not aware that a very large portion of the wool grown in Australia is sold in France and Germany ? Does he not know that the price of our wool is largely maintained by French buyers ? Does he not know that there are subsidized French steamers that take away our goods, and pay us a good price for them? There is, however, one good feature of this Bill, and that is that if it is passed it will, I believe, lead to the break up of the caucus. That is my frank opinion. The Bill will chiefly benefit manufacturers in New South Wales and Victoria, because they are the two principal manufacturing States. Speaking as a representative of New South Wales, I say that the vast majority of the people of that State do not want the Bill.
– Do they not want something that will benefit them?
– They have hitherto conducted their business in accordance with principles which they have inherited from the mother country. They are ,satisfied with those principles. They believe that freedom of exchange between our commodities and the commodities of other countries is beneficial for the people as a whole. Victoria, however, does want the Bill. But what about the smaller States? What will be- the position of Tasmania, Western Australia, Queensland, and South Australia? The Bill, if it does anything, will absolutely encourage trusts and combines, and will increase the price of goods to every man, woman, and child in the Commonwealth. Suppose a manufacturer in England pays his men 30s. a week, whilst a manufacturer in a similer line of business in Victoria pays his men 40s. Under this Bill the English manufacturer will be shut out, because it will be said he interferes with labour in Victoria. But if his goods are excluded the effect will be to black-mail the people of the smaller States. Under present conditions they can buy their goods at certain prices. The Bill says that they shall not buy goods made abroad, because they interfere with Victorian industries. But if those goods are excluded the first effect will be to interfere with the flow of imports and exports. If the effect is to lessen imports it will increase freights to the producers of butter and other commodities, because vessels will not come here empty and take away our goods at the same rates as they now receive. Consequently, the Bill will be most injurious to the producers of the smaller States. Take another point. Is there a man who does not know-, the pleasure that a woman finds in making a cheap bargain at a shop? There are hundreds of thousands of pounds worth of goods coming into Australia that are simply the surplus stocks of European manufacturers. Thev are imported for the express purpose of being cheaply sold in Australia. Suppose there is a manufacturer in Melbourne who employs thirty or forty hands, and pays them 40s. a week; and suppose there is a manufacturer of similar goods in England who pays 30s. a week - though it’ may be remarked that 30s. a week in England will probably go as far as 40s. here. This Bill would stop the importation of those goods, because the one manufacturer in Victoria might say that his business was injured by them. Is it likely that the importer would take the risk of importing goods under such circumstances?
– The honorable senator formerly said that the Bill would have no effect ; now he says that it is going to have a disastrous effect.
– I never said it would have no effect. The tenor of my speechhas been that the effect of the Bill upon trade will be simply revolutionary. That is what I have said from the commencement. The Minister does not realize what this Bill will mean if it is carried in its present form. He does not realize that it must tend to develop and consolidate trusts and combines. There appears, to be a general want of knowledge as to the great importance of pools and rings in the industry of any country. There are rings and pools in Australia to-day. There have been for fifty years past, and I hope there will be in the future. They often do harm. They often use the power which they possess to squeeze the public. We had an illustration of that during the drought, when the Sussex-street importers of Sydnev imported grain from abroad, and raised the price to the poor squatter 150 per cent.
– By means of the. Tariff.
– Whatever the cause may have been, in my opinion, the ring did a verv cruel and tyrannical thing, as rings often do. But it must not be imagined that production and commerce could be successfully carried on without rings or middlemen. I often hear middlemen traduced, but they have their uses. Business would be reduced to a state of chaos if it were not for them. Take any branch of business honorable senators choose. Four or five middlemen in Sussex-street combine. Thev have knowledge that there is going to be a scarcity in a certain article in Europe. Say that they buy maize, giving the producer his own price for it. Afterwards perhaps the maize which they have bought for 2S. 6d. runs up to 3s., an3 the seller thinks that he has been “had.” The fact of the matter is, however, that if the producers were left to themselves, and there were no middlemen, the probability is that their goods would not realize, on the whole, nearly so much as they get for it.
– My belief is that they would realize more.
– I am speaking from knowledge. The agents or middlemen correspond with the producers, who are their customers, telling them that they must not send their goods to market except at a certain time, because if they do the effect will be to produce such a glut in the market that their commodities will be absolutely thrown away. If they are perishable goods they will be destroyed. These middlemen almost every day advise their clients as to whether they should send their goods to market or not. They have a knowledge of the capabilities of the market not only in this country, but in Europe, and’ they know when they will be able to secure a price that will satisfy the producer. I quite sympathize with Senator Henderson’s view, but probably he does not realize the actual state of affairs. If he were a producer - an agriculturist or a dairyman for instance - he would see the full force of sending his goods to an agent who had a full knowledge of market conditions, and who would be able to dispose of his produce to the best advantage.
– We could have a Government produce depot
– Then the middleman would be abolished.
– We could do nothing except what is done at the present time unless industries were nationalized. Of course, if we nationalized all industries the Government would have to d’o exactly what the middleman does now. There would be a central depot, which would obtain knowledge as to the conditions of the market, and advise the producers when to send in their, goods, so that the Government might sell at the best price. Some time ago there was, I think, a great ring in Western Australia which regulated the price of cattle. In that case I am not sure that the effect was beneficial, because I believe the proceedings were often carried beyond the limits of fair play, and the public sometimes had to pay dearly. I cannot indorse the proposal to confer on a Judge the powers proposed by the Bill.
I recognise the probity of our Judiciary ; and I am sure that the Judge appointed would perform the duty of sifting the evidence before him to the best of his ability. In my opinion, however, the questions involved are purely those of business, with which Judges and lawyers generally are not usually very conversant,., beyond such knowledge as is picked up bv them in the course of their professional work. My suggestion is that before the Bill is passed, or immediately afterwards, the Inter-State Commission should be appointed, ^ and have thrown upon it the responsibility which the Bill seeks to impose on a Judge. This, I believe, would tend to a more equitable administration ofl the Bill, and avoid placing a Judge in a most unfair position. I cannot approve of a measure of this kind being introduced and passed without having, in a more direct way, been submitted for the approval of the public at large. The questions we are dealing with are essentially of a fiscal nature, and could more properly be discussed when the Tariff was before us. Indeed, I regard the introduction of the Bill as somewhat of an insult to the public. We are now at what is practically the fag end of the session, and the public have not been afforded an opportunity to say a single word in regard to it; there is no evidence, as I said before, that the people, as a whole, approve of a measure of. the character. I am certain that if a referendum were taken, both protectionists and free-traders would resent this interference with their constitutional rights, and with their natural liberty to purchase goods from other countries, especially England, under perfectly healthy and natural conditions. If Australia ever becomes a manufacturing country, we shall doubtless produce surplus stocks; and I am sure .we should regard it as very unjust if the mother country were to pass a similar law with the object of preventing the export of those stocks to her shores. About twelve months ago, in one of the best articles T ever read on this subject, it was shown that dumping, instead of being an injury, is absolutely an immense benefit to the manufacturers of England, because these, goods are purchased at a low figure, and reexported to the country of origin at a large profit. Dumping under normal conditions is essential to trade, though I grant there might be exceptional conditions under which it would not be desirable. I can- not, for one moment, imagine any manufacturer, on personal grounds, setting to work to ruin an Australian industry ; but the Bill seems to contemplate such a state of affairs. Under any circumstances, I cannot believe that any manufacturer in England would seek to ruin a manufacturer in this country. Senator Millen was perfectly right when, in the course of his able speech, he showed the utter hypocrisy of the whole measure as exemplified in clauses 4 and 5. That honorable senator made it clear that the ulterior object of the Bill is prohibition, in order that certain industries in Australia may reap the advantage. I believe that’ the people of Australia would not indorse the Bill if it were placed before them; and we have no right to pass a measure of the kind at this period of the session. I hope that the Minister will either withdraw it, or permit amendments to be made so that it may prove of some good, while not unduly interfering with the trade and commerce cf the Commonwealth.
– It is my intention to deal with several matters when we reach the Committee stage, and at present I shall confine myself to only one or two aspects of the Bill. It has been argued that this is a. Bill to prevent unfair competition; and in this connexion I may quote a circular which came into my possession yesterday. It is from an Adelaide firm representing the Colonial Oil Company, and is as follows: -
We beg to advise you that the Colonial Oil Company have decided to continue the rebate to retailers, and rebate will be paid accordingly on your purchases of American “ White Rose “ kerosene during the six months ending 31st December, 1906, and following six-monthly periods until further notice, provided you sign a declaration form stating that you have neither bought nor sold any other than American “ White Rose “ kerosene during each six-monthly period. As it is just possible you may have purchased kerosene other than “ White Rose “ since 30th June last, we beg to say that this will not disqualify you from claiming rebate on your purchases during the present six-monthly period, provided you do not continue to purchase any other kerosene after receiving this notification that the rebate to retailers is to be continued.
When this Bill was introduced the Colonial Oil Company apparently imagined that they would be brought under its provisions, and thereupon notice was given to customers that the rebates would be discontinued. During the discussion of the measure, however, the Colonial Oil Company appear to have altered their opinion, and, coming to the conclusion that the Bill will not affect them, they have boldly issued the circular which I have read.
– Is not that just the class of case the Bill was supposed to touch ?
– I think so; but we have seen legal senators taking opposite views on that question.
– The case of the Colonial Oil Company has not been mentioned before.
– That is so; but the whole question of rebates and monopoly of custom has been before, us. There is no doubt that this is a conditional rebate. The circular continues -
It is claimed that the discontinuance of the rebate to retailers does away with the retailers’ profit on “White Rose” kerosene, and for this reason the Colonial Oil Company have decided to continue the rebate to retailers. The purchase of “Royal Daylight” kerosene, or any other oils of which the Colonial Oil Company are the sole importers, does not invalidate your claim for rebate on American “White Rose” kerosene.
– Who constitute the Colonial Oil Company?
– The company is represented in Adelaide by Messrs. Wilkinson and Company.
– Has the Colonial Oil Company anything to do with the Standard Oil Company P
– The Colonial Oil Company is virtually the Standard Oil Company.
– Then “ Colonial Oil Company “ is a false description ?
– What “do the rival oil people say?
– The British Imperial Oil Company says that this practice of the Colonial Oil Company amounts to undue competition.
– Why does the British Imperial Oil Company not also give discounts?
– Because I understand it cannot afford to do so.
– Does the British Imperial Oil Company want a higher price?
– The British’Tmperial Oil Company sells at the same price, and all it asks is that conditional bargains of the kind shall be made illegal.
– Who gets the benefit? I should think the consumer:
– The BritishIm.perial Oil Company has issued the following circular: -
For some time past there has been considerable competition in Australia between the respective trading companies in kerosene, with the result that one company has adopted the principle of granting a conditional special rebate per gallon to customers who deal exclusively in their brands of kerosene. We would respectfully ask your support in suppressing the rebate system by introducing into the present Anti-Trust Bill a clause to prevent any company attempting to monopolize the trade by the granting of conditional rebates. We feel sure that practically every dealer in kerosene would prefer to have an open market, and would welcome an Act to suppress the granting of conditional rebates, which are detrimental to both retailers and consumers. We take this opportunity of enclosing a copy of the circular issued, and which we think speaks for itself.
– The honorable senator ought to move an amendment which would have the effect desired.
– I am not prepared to do that. The only position I take up is that in the oil trade there are these special rebates ; and the same practice is carried on iri the other large manufacturing industries throughout Australia. The Colonial Sugar Refining Company, I believe. adopt exactly the same principle, with the result - I do not grumble at it - that it has virtually shut Mauritius sugar out of the Australian market.
– That is all in the interest of local industry.
– In the case of sugar, the practice is in the interest of local industry. I desire now to deal with the matter referred to by Senator de Largie, who condemns the shipping companies for doing exactly what the Colonial Sugar Refining Company does, and what the oil manufacturers propose to do.
– That does not make the practice right.
– Does Senator Guthrie think’ that the shipping combine is injurious?
– I shall deal with that point presently. What I desire to show now is the exact position in regard to freights or. the Australian coast. I have gone to some trouble to obtain figures, which were received in answer to advertisements inserted in the English newspapers, calling for tenders to carry the principal products of Australia along the British coasts. Although in Australia double or treble the rates of wages have to be paid, and the cost of all necessaries is relatively higher, the shipping combination in Australia is charging less freight, mile for mile, than is charged on the British coasts. I do not think that any honorable senator would attempt to compare ocean carriage with coastal carriage. In the case of the Colonial Sugar Refining Company there is protection against the outside world, and yet rebates are given. But in the case of the shipping industry, in which a large amount of capital is invested, and which is most important to Australia, affording, as it does, employment, directly and indirectly, to a large number of men, there is absolutely no protection - no subsidies, no bounties, or assistance in any way from any State.
– Why should the industry have assistance?
– I am not saying that the industry should have assistance, but merely pointing out that it has had to rely on itself.
– And it is very able and fit to do so.
– It has been said that outside the combination there is no competition;’ but I can1 prove the contrary. In Western Australia the other day tenders were called for the carriage of mails along the southern coast, and that contract was obtained by the owner of the steamer Maitland, in competition with the combination.
– Who is the owner of the *Maitland**
– A private owner in Sydney. Then, from Fremantle, along the whole length of the north-west coast, there runs a line of steamers registered in Singapore.
– That line is in the ring just as is the Adelaide company.
– The line of steamers of which I speak has nothing to do with the Shipping Federation.-
– It works hand in hand with the Shipping Federation.
– It has nothing to do with the Shipping Federation, which, has taken the precaution to register under the Conciliation and Arbitration Act. I do not say that the Shipping Federation has been ‘ compelled by law to take this step, but, if it did not, the GovernorGeneral would have power to compel it to register. At any rate, the federation has become an association for the purpose of fighting labour.
Sitting suspended from 6.30 to 7.45 p.m.
– There is a question which I should like to put to the Minister, and which he can answer when he makes his reply, because it may help some of us considerably in coming to a decision.
– I do not propose to reply. I think we have had quite enough discussion on this measure.
– I desire to get from the Minister some information in order to decide how I shall vote.
– What is the point?
– When a question is put, the Minister in charge of the Bill ought to be prepared to give a reply, especially when it comes from a supporter. The Oil Company is a corporation which has its head-quarters outside the Commonwealth, and with which, therefore, we cannot deal. It ships its oil to an agent in each State, who transacts all the business with the retailer, and the whole transaction takes place within the boundaries of that State. Can the provisions of the Bill reach the people within a State who are not transacting business outside its limits ? Or will it be an infringement upon State rights ?
– If the people are a corporation, we believe that we can deal with them in the State, but if they are individuals, we cannot deal with them.
– Suppose, for instance, that Burns, Philp, and Company, in Svdney, were agents for the British Imperial Oil Company, and the distributor’s of its oil throughout New South Wales, would the provisions of the Bill reach the firm as agents for the company ?
– That is a legal question which I should not be expected to answer right off.
– It is a point of some importance, I think, because, otherwise, every provision of the Bill could be evaded by a corporation through merely appointing an agent in “each State to transact its business therein.
– The chances are that the agent would come under the first part of sub-clause 1 of clause 4 -
Any person who either as principal or as agent enters into any contract..
– That relates to trade amongst the States, but Senator Guthrie is talking about trade within a State.
– That is a legal question which I cannot be expected to answer now… I can get an answer from the Attorney-General, though.
– Before we are asked to give a vote, we should understand clearly how far-reaching the Bill may be. We ought to know whether the Bill would meet such a case as I have put, or whether it could be evaded by the agent. Reverting te the question of rebates, so far as my knowledge goes, the ship-owners have n loose federation.
– .What does the honorable senator call a close one ?
– :Each company in the federation has, I believe, a distinct and separate existence, with its own offices, officers, and capital. That is why I used the term “ loose federation..” There can be no doubt that it is a combine. I have had some connexion with the combine in relation to wages and working conditions. Prior to its formation each one of the six companies forming the combination was enjoying free competition, and trying to steal all the trade it possibly could from the others. Literally they were cutting one another’s throats by competing against each other. Two or three boats would be leaving a port on the same day, and each would take about a third of a cargo, and at a rate of freight which did not pay the owners for the cost of handling it. If the boat of another company came into port three or four days later, when no boats were leaving, up would go the rate of freight to considerably higher than it is to-day. Unnecessary tonnage was run ; ships made trips with nothing like a fair loading; and wages fell by one stroke 30 per cent.
– Wages were higher before the companies federated than they have been since.
– I admit that some time prior to the formation of the federation the wages were higher, but at its inception they were 20 per cent, lower than they are to-day.
– How many years ago?
– In 1891, 1892, and 1893.
– The federation has only been in existence a few years.
– It has been in existence since 1894.
– I suppose that freights were lower.
– On some days freights were lower, and on other days they were higher.
– The honorable senator is taking the most depressed years in Australia.
– At any rate, wages came down, and not one of the six companies paid a penny in the way of dividends to its shareholders. I feel sure that, so far as the steamers were concerned, the shareholders did not benefit one penny from low freights on certain* days and higher freights on other days. When he was before the Navigation Commission, Mr. Glassford, who is one of the leading produce merchants in Melbourne, and who spoke not only for himself, but for a majority of the produce shippers in Victoria, said that they hailed with satisfaction the formation of the combine, because they knew exactly now when boats would sail, what the freights would be, and that every one .would be on a level footing in that respect.
– Probably he was afraid to say anything else, for fear of the manipulations of the ring.
– I would not say that. I believe that Mr. Glassford is just as independent as any man I know in Victoria to-day, and I do not doubt for a moment the evidence which he gave before ‘the Royal Commission.
– What did the merchants in Brisbane say?
– I am going to show what ground there was for the merchants in Brisbane making the complaints they did. In that city we had evidence given on each side. We had evidence similar to that given here by Mr. Glassford, as well as evidence to the effect that the shippers were being “ bled “ by this huge monopoly.
– By a. witness who was a member of the shipping ring.
– That evidence wag given by a witness who, I believe, was manager for a company which was agent, not only for ships in the combine, but for outside ships. What was the extent of the “bleeding” that took place? I have already stated that the figures I possess can be taken as authentic. The
English figures were got by calling for tenders, and the Australian rates are rates which are not charged to one firm, but which are charged to every shipper. For the first time to-day, I have heard that there are secret commissions. I am not aware that there are secret commissions in the Inter-State trade. There was no such evidence given before the Navigation Commission. I heard it stated that there were rebates.
– And secret commissions.
– No; I heard that the same rebates were given to every firm which shipped all its goods by the company.
– Mr. McPherson was the witness who said that secret commissions were given.
– No.
– He read a letter from the secretary of the Chamber qf Commerce, who made that charge.
– He said that rebates, not secret commissions, were given to those who shipped all their goods by one company.
– Is not that like the case of the Oil Company?
– Exactly.
– The Honorable senator is defending one and condemning the other.
– I have neither condemned one nor commended the other. What I have said so far has been that to the workers the combine has not been an evil,- I have tried to prove that when there was free competition the steamers reaped no benefit. I have instanced the case of Western Australia.
– What trade is there outside the shipping ring?
– Only a “few months ago a combination of Broken Hill companies called for tenders for the carriage of coke to Port Pirie, and of ore and bullion to Sydney. The combine, which has a monopoly of the coastal trade, did not get the contract, which was for the carriage of 1,000,000 tons of ore per year. It was obtained by Scott, Fell and Company, of Sydney.
– There was a number of vessels running back empty from Port Pirie.
– Exactly. Again, between Melbourne and Launceston, the
Union Steam-ship Company is faced with opposition from outside the ring. Between Tasmania and Adelaide, there is also opposition from outside the ring.
– What sort of opposition ?
– There are steamers running from Tasmania to Adelaide
– What is the tonnage ?
– I cannot tell the honorable senator exactly now.
– According to the figures given to the Navigation Commission, the tonnage was less than 10,000 tons, and that out of nearly ‘200,000 tons.
– And by steamers which did’ not carry passengers. ‘
– What Senator Guthrie says is that it is a very large but only a partial monopoly.
– The coasting trade is open to any one who may choose to come in and compete for it. Again, for years the firm of J. and A. Brown have been running steamers independent of the monopoly, and, I believe, are doing a verygood business, too. Let me now compare the freights from London to Aberdeen, a distance of 430 miles, with the freights between Sydney and Melbourne, a distance of 576 miles. Flour is carried from London to Aberdeen in small lots at 12s. 6d. per ton, and from Sydney to Melbourne at 7 s. 6d. a ton, with 20 per cent rebate.
– What does the honorable senator mean by a small lot ?
– Perhaps 5 or 10 tons. On the Australian coast, the combine carries any quantity - from 1 ton to 10,000 tons - at 7s. 6d. per ton, with 20 per cent rebate.
– What is the freight from Adelaide to Melbourne?
– Flour is carried from Adelaide to Melbourne, a distance of 504 miles, at 7s. 6d. per ton, with 20 per cent, rebate, while from London to Cork, a distance of 536 miles, it is carried at 8s. 6d. per ton.
– I cannot understand the verv much higher freight between London and Aberdeen.
– The difference is exactly the same as exists between Adelaide and Fremantle.
– Why is the freight to Cork so low in comparison with that to Aberdeen ?
– Because there is not the back loading which is obtained from Aberdeen. From Fremantle to Adelaide, there is virtually no back loading.
– They have a great passenger traffic, though.
– Yes.
– But they have not much passenger traffic from Aberdeen to London.
– Have they not?
– Not with steamers.
– They carry a great many passengers and mostly on deck like cattle. On jute sacking and yarn, the freight from London to Aberdeen is 14.&. 6d. per ton, and from Svdney to Melbourne, 10s. a ton. On drapery goods and woollen goods in bulk, the freight from London to Aberdeen is 27s. 6d. per. ton:
– What is the use of the honorable senator quoting those figures, if he does not give the rates of freight for the back loading, and what there is to be carried?
– I am giving the particulars from one port to another. Drapery and woollen .goods in bales are carried from London to Aberdeen at 27s. 6d. per ton. They are carried from Sydney to Melbourne for 10s. per ton, or 17s. 66. a ton less for a distance of 130 miles more. Wines and spirits in bulk are carried from London to Aberdeen for 20s. ; from Svdney to Melbourne for 12s. 6d. Wines and spirits, in case, are carried from London to Aberdeen for 27s. 6d. ; from’ Melbourne to Sydney for 12s. 6d. Next, take freights from London to Leith, a distance of 404 miles, as compared with the voyage from Sydney to Brisbane, 510 miles, or 106 miles more. Flour is carried from London to Leith in 20-ton lots and upwards at 10s. 6d. per ton ; from Sydney to Brisbane for 7s. 6d. per ton, less 20 per cent, rebate.
– Where does the rebate come in?
– The companies pay a’ rebate, provided the exporter gives a monopoly of his carrying trade. Jute goods are carried from London to Leith for 12s. 6d. per ton; from Sydney to Brisbane for jos. Woollen goods are carried from London to Leith for 30s. ; from Sydney to Brisbane for 10s., or £1 per ton less, although the distance is 106 miles greater.
– There is something wrong with those figures.
– I challenge any one to find inaccuracies in them.
– Where do they come from?
– I have compiled them myself from data that cannot be contradicted. Next, take the voyage from, London to Cork, a distance of 536 miles. Flour is carried from London to Cork for 3s. 6d. per ton. It is carried from Adelaide to Melbourne, a distance of 504 miles - 32 miles less - for 7s. 6d., less 20 per cent. Wheat is carried from London to Cork for 15s. 6d a ton; it is carried from Adelaide to Melbourne for 8s. a ton, less 20 per cent. Oilmen’s stores are carried from London to Cork for 32s. 6d. ; from Adelaide to Melbourne for 10s. per ton, or 22s. 6d. per ton less. Horses are carried from London to Cork for 62 s. 6d. each ; from Adelaide to Melbourne, 35s. each.
– These figures only show that we do not need an Anti-Trust’ Bill. ‘
– -They show that the accusations that have been made about’ cruel freights have no ground whatever.
– Why did- the honorable senator sit and listen while witnesses made those charges before the Navigation Commission?
– I had not this information in my possession at that time.
– It shows that the shipping combine is not injurious.
– Exactly. It is difficult to get on the English coast line such distances as we have in Australia. I have therefore been obliged to stretch out a little, and take Norway and Sweden into the calculation in order to secure a comparison. From London to Christiana the distance is 656 miles. I compare that voyage with the distance from Adelaide to Melbourne, 504 miles - or 152 miles less. From London to Christiana flour in large parcels is carried at 7s. 6d. a ton; flour, irrespective of quantity, is carried from Melbourne to Adelaide at 7s. 6d. per ton, less 20 per cent.
– The honorable senator is giving us freights from England to Christiana. Let him tell us the freight on butter and other commodities to London.
– I cannot.
– What is the use of the figures, then?
– Horses are carried from London to Christiana for 63s. each ; they are carried from Adelaide to Melbourne for 35s. Fodder goes from London to Christiana for 10s. a ton ; it is carried from Adelaide to Melbourne for 10s. a ton. That is the only instance where freights are equal1 in this comparison. Drapery, cotton and woollen goods are carried from London to Christiana for 13s. 4d. per ton, plus 15 per cent. ; they are carried from Adelaide to Melbourne for 10s. a ton. There is no rebate in that case. Next, I wish to get a distance to compare with that between Adelaide and Fremantle. The distance from London to Belfast is 712 miles; from Adelaide to Fremantle it is 1,380 miles - nearly double the distance. It must be remembered at the same time that there is back loading from Belfast to London, whereas there is comparatively little from Fremantle to Adelaide. Drapery is carried from London to Belfast for 41s. iod. per ton ; from Adelaide to Fremantle for 20s. per ton, or nearly 22s. per ton less for double the distance.
– I had some goods taken to Western Australia, and paid more than that.
– The honorable senator sent them through a middleman. Wines and spirits are carried from London to Belfast at 34s. 4d. per ton ; from Adelaide to Fremantle at 22s. 6d.
– Those stores are rarely carried from Adelaide to Fremantle; they come to Western Australia direct.
– Any quantity of goods are taken from Melbourne and Adelaide to Western Australia. Oilmen’s stores are taken from London to Stockholm, 1,127 miles, for 20s. a ton; they are carried from Adelaide to Fremantle, 1,380 miles, for 20s. a ton, less 10 per cent, rebate. Fodder is carried from London to Stockholm for 29s. a ton; from Adelaide to Fremantle for 10s. a .ton, less 10 per cent, rebate. Unfortunately, I have left in my bag some figures which I intended to quote in regard to passenger fares on the English coast, and on the Australian coast. I shall quote them in Committee. I may, however, say this - that a better class of boats than are employed on the Australian coast is not to be found in any part of the world. In respect of accommodation, attendance, and catering the vessels on our coast are equal to any that I know of in any coasting trade in any part of the world, and the fares will compare favorably with those charged elsewhere. I had prepared these figures for another purpose, but I thought it just as well to give the Senate the benefit of them now. With regard to the Bill itself, I say frankly that I do not like it. But it has been stated that under our Constitution we have no power to nationalize monopolies. The very fact that an honorable senator has introduced a Bill for the purpose of enabling a referendum to be taken on that subject affords proof that in’ the opinion of others, as well as myself, we have not that constitutional power at present. My opinion is, therefore, that it would be as well to adopt this as a tentative measure. I think there are brains enough in Australia, without going to America, to devise means to cope with our own situation. However, in my opinion, the true remedy for any monopoly that may spring up is nationalization. I wish to refer to one other matter before concluding. During the debate, a considerable amount of discussion has taken place regarding the boot industry. A desire has been ex -‘ pressed that a document quoted by Senator McGregor should be laid upon the table of the Senate. Inquiries have been made as to how that desire could be met, and I hope, Mr. President, that you will excuse me for re-reading the declaration quoted by Senator McGregor in order that any honorable senator who chooses may afterwards move that it be printed. It will then be in the possession of the Senate. I also intend to read some other declarations bearing upon the same question, and which also can be laid upon the table. The declaration quoted by Senator McGregor was as follows: -
I, William Marshall, of 30 Russell-street, Melbourne, formerly of Nott-street, Port Melbourne, shoe manufacturer, do hereby make oath and say that -
In the year nineteen hundred and one (1901) I entered into a contract with the United Shoe Machinery Company of America for the leasing of a consolidated hand method lasting machine. One of the conditions of the lease was that I had to pay them about seventy pounds (£70) cash when the machine was installed, and thereafter a royalty of fifty-two pounds (£52) per annum (this is as far as my memory serves me).
The United Shoe Machinery Company further protected themselves by insuring the machine for the sum of three hundred or three hundred and fifty pounds, for which I was conditioned under the lease to pay the insurance premiums.
On 17th September, 1901, my factory was totally destroyed by lire, and in the general destruction the lasting machine was ruined.
The United Machinery Company not only collected the insurance on the machine, but, acting under another condition of their “lease,” demanded and took possession of the “remains” of the machine, and would not make any refund of the original payment (seventy pounds), nor would they rebate anything out of the insurance money, which they collected, and the premium for which I had paid.
As far as I remember, the machine was installed only about’ two months prior to the happening of the fire. It had therefore hardly been used.
Wm. Marshall.
Declared before me this 19th day of July, in the year 1906.
J. Ham, J. P.
– If the machines belonged to the company, why should they he expected to pay a portion of the insurance money to any one else?
– That is not the question.
– It is one of the complaints.
– No ; the complaint is that a royalty had been paid in advance, and that no allowance was made for that.
– What was the value of the machine?
– It was insured for £300 or£350.
– The value might have been more than that.
– It is not likely that, when the lessees had to pay the insurance premiums, the company would insure the machines for less than their value.
– Insurance companies would hardly allow insurance up to 100 per cent.
– Most of them do, and are glad to get business. Senator Pulsford said regarding the matter -
I am in a position to say that it was absolutely unjustifiable, and is not borne out by the facts.
– Whatis the honorable senator reading ?
– From a statement regarding Senator Pulsford’s remarks.
– A statement of Senator Guthrie’s own?
– Yes.
– Prepared by himself?
– Not quite; on information received.
– From Marshall ?
– From Marshall and others.
– These affairs happened five years ago.
- Mr. Marshall is still living.
– He has forgotten all about it.
– No, he has not. He has made a declaration, dated19th July. I am making this statement from information which I have received, very much as the honorable senator himself sometimes makes statements.
– I wanted to know the authority.
– It is a statement of facts.
– They are not facts within the honorable senator’s own knowledge.
– Exactly ; but I am giving them as true statements to the best of my belief. Senator Pulsford, in the course of his remarks, produced documents which were not true within his own knowledge, but which had been handed to him for the purposes of this debate. Amongst the documents was a receipt for £80. Senator Pulsford, however, knew no more whether that £80 was paid by Marshall than I know. I wish to point out that at the time Marshall’s place was burnt there were in the factory, belonging to the United Shoe Machinery Company, two Goodyear welting machines, two stitching machines, two Ideal lasting machines, and one Copeland lasting machine; and for the installation of each of those machines in his factory Mr. Marshall had to pay at least £50. These machines after the fire were in fairly good order. They could have been repaired cheaply and sold for a considerable amount of money ; but the company absolutely refused to allow Mr. Marshall to deal with them. The company took possession ; and the £80 received was in respect of other machinery, and not in respect of the machinery in dispute.
– Does the honorable senator say that not a penny of the £80 was paid in respect of the special machine in dispute?
– I shall tell the honorable senator the exact circumstances directly.
– Why should we investigate all these details?
- Senator McGregor has been absolutely challenged to lay this document on the table ; and it is as well that Mr. Marshall’s position should be made clear.
– What I thought was to be laid on the table was the first declaration made by Mr. Marshall, and then the declaration in reply.
– The£80 cheque was actually a refund of a totally different character from that which has been represented, and not a penny of it was in respect of the lasting machine. Senator Pulsford also read a declaration from Mr. Henry Best, taken before Mr. George. Walker,
– Is the honorable senator leaving Mr. Marshall’s matter?
– No. This declaration was read by Senator Pulsford in reply to the declaration read by Senator McGregor, and is as follows: -
August 14, 1906.
Having seen in Herald of10th inst. a statement purporting to have been made by Mr. McGregor in the Australian Senate, speaking on the Anti-Trust Bill, that Henry Best, a boot manufacturer, had been deprived of machinery held by him under lease to the U.S.M. Coy. for- the reason that he had working beside them a non-royalty machine, I, Henry Best, of my own free will and accord, voluntarily make this statement, under oath, that the statement as reported is not according to fact. The U.S.M. Coy. have never taken any machine from me, neither have they threatened to take machines because of my using non-royalty machines in my factory. (Signed) Henry Best.
Before me, William Geo. Walker, J. P. - 14th August, 1906.
Mr. Best, at the time of making the declaration, was lying in the Melbourne Hospital undergoing an operation; and the local manager for the United Shoe Machinery Company drove to the hospital and obtained his signature.
– Does the honorable senator say that the signature was obtained unfairly, or by undue influence?
– The signature was obtained at a time when Mr. Best was not absolutely in possession of his whole mental faculties.
– Why does the honorable senator make a charge like this, when he personally does not know anything about the circumstance?
– I am simply stating the fact that Mr. Best was undergoing an operation, and that the manager of the United Shoe Machinery Company was the man who obtained the signature.
– Was the declaration true? That is the question.
– The fact that Mr. Best was in bed does not show that he was a lunatic, or not in possession of his senses.
– What does Mr. Best say about the matter now?
– I have not seen Mr. Best.
– Does the honorable senator not think he ought to have seen Mr. Best before throwing doubt on the statement?
– I am stating the conditions under which the signature was obtained!
– But the honorable senator has said that ‘he does not think Mr. Best was in possession of his whole mental faculties at the time.
– I said that probably Mr. Best was not in possession of his whole mental faculties.
– Why saythat?
– If the honorable senator were undergoing an operation in a hospital he probably would not be in possession of his whole mental faculties.
– Senator Guthrie ought not to have brought this matter before us unless he could prove that Mr. Best now denies the statement he previously made.
– This declaration has been made use of in the course of the debate, and I think I am justified in explaining how the signature was obtained.
– Not unless the honorable senator has reason to believe that the signature was got unfairly.
– Honorable senators have had sent to them a circular signed by a number of boot manufacturers in New South Wales, Victoria, and South Australia, but we see that the number of “ signatories is not anything like representative of the whole of the boot manufacturers in Australia. There are 140 boot and shoe manufacturers in Victoria, and out of that number only twenty signed the circular.
– Do not those signatories represent big houses?
– There are some representatives of big houses who have not signed the circular. There are 111 boot and shoe manufacturers in New South Wales, 105 in South Australia, six in Queensland, six in Tasmania, and six in Western Australia.
– Are there in South Australia 105 establishments that can really be called boot manufactories?
– Yes, every one of them. I have here a declaration by one of the gentlemen! who signed the circular, showing that he did not understand clearly what he was signing at the time.
– Does the honorable senator really think that what he is stating is a reason for agreeing or object ing to the Bill, namely, that one of the signatories of the circular did not know what he was signing?
– I have already pointed out that the signatures on this circular do not represent anything like the number of people in the boot and shoe business. This circular was addressed to every member of the Senate, and has been used as an argument for the rejection of the Bill ; and I have here a sworn declaration bv the representative of the firm of J. Hunter and Sons, of Queen’s-parade, Clifton Hill, Victoria, to the following effect : -
I, Andrew Hunter, of Hunter and Sons, of No. 113, Queen’s Parade, Clifton Hill, in the colony of Victoria, boot manufacturers, do solemnly and sincerely declare that -
Having been shown a copy of the petition presented to the Senate on the 18th August, 1906, and purporting to be tendered by the boot and shoe manufacturers of Victoria, New South Wales, and South Australia, and to which my signature is attached - I was greatly surprised to find on reading the petition carefully, that it does not contain the matter as represented. At the time I signed the petition I was too busy to read such a lengthy document, and simply took the explanation offered as to what it actually represented -
– There has been no petition presented to the Senate.
– This is a memorandum presented to the members of the Senate, and proceeds. - and I signed it understanding it to be a petition from the boot and shoe manufacturers to the United Shoe Machinery Company asking that they would place their machinery with the boot and shoe manufacturers on a more equitable, reasonable, and business-like footing, and to amend and strike out those objectionable clauses at present to be found in their leases. This was exactly the impression conveyed to me when I signed the petition.
And I make this solemn declaration conscientiously believing the same to be true, and by virtue of the provisions of an Act of the Parliament of Victoria rendering persons making false declarations punishable for wilful and corrupt perjury.
Declared at Fitzroy, In the State of Victoria, this twentieth day of August, one thousand nine hundred and six.
Before me, R. D. Hooper, J. P.
These declarations disclose facts which I think ought to be laid before honorable senators.
– The honorable senator promised before he sat down>, to deal further with the case of Mr. Marshall. I asked whether the honorable senator affirmed, or Mr. Marshall affirmed, that he had never received any allowance in respect of the particular machine.
– I said that Mr. Marshall had not received any allowance in regard to the particular machine, but that he had received the ,£80 in respect of other machines.
– My question was a simple one. Did Mr. Marshall receive any rebate or allowance from the company in respect of this particular machine?
– I believe not.
– The honorable senator “ believes not.”
– Mr. Marshall’s own statement is that he received nothing.
– And the honorable senator has Mr. Marshall’s receipt showing that he has received an allowance.
– Yes, for something else.
– No; absolutely in respect of the particular machine.
– I have not the number of Hansard here which would show the receipt, but we shall have ample opportunity to discuss the matter in Committee.
– We shall go into Committee on the Bill, and not on Mr. Marshall.
– It was Senator Symon who first introduced this matter into the debate.
– I am not responsible for introducing the case of Mr. Marshall.
– But the honorable and learned senator is responsible for introducing the subject of the company’s business, and honorable senators have taken up the position that the United Shoe Machinery Company acted unjustly- - - that it leased the machines, and would not allow manufacturers to instal other machines. That has been denied.
– It has, and the man who is said to have denied it has made a declaration that the denial is not correct.
– There is plenty of proof, which we shall have another opportunity to consider. As to the Bill, I shall vote for the second reading, and agree to its passing, with some amendments, always regarding it merely as a tentative measure. I hope that before long we shall have a Bill to deal with any dangerous monopolies which may be in our midst, but I do not think the measure before us will be effective, though some good may come of it.
Motion (by Senator Croft) agreed to -
That the three statutory declarations read by Senator Guthrie be laid upon the table. s Motion (by Senator Pulsford) agreed to -
That the documents be printed.
– If the importance of the measure we are now discussing is to be measured by the length of the debate, and, I think, I would be right in saying, by the high quality of the debate, then, undoubtedly, it is of vastly greater moment than one would be led to suppose, judging from the numerous honorable senators who have so coldly turned their backs upon it. I am not one to run bald-headed against what are known as trusts and combinations. I am not going to characterize them as infamous, or as1 practically a menace to our existence. In fact, I have rather a kindly regard for trusts, being inclined to look upon them as creatures of the very circumstances under which we live—as a’ natural, product of our times. Trusts appear to me to be just the very result that we might expect from the advance of the evolutionary - process in industrial life. If we look back, it seems a great number of years since the small things in industrial life were, left behind. Although only a few years have gone by since trusts came into existence, it seems almost centuries since manufactures were carried on in small factories by individual employers, and under conditions which are entirely dissimilar from those prevailing in our industries to-day. It is of no use to dream that we are going to bring back the little man. Like Julius Caesar, he is gone and will stop where he is. The trusts and combinations have come, not to take the place of the man who has gone, but because the advance of the evolutionary process in our industrial life have given them scope and life. If it were possible by legislation to annul the power of the trusts, that would at once kill the entire influence and mighty operation of combinations, and by one fell stroke advance the civilization in which we live. I am inclined to disbelieve any such thing. The combination of capital was essential to the conditions of the day when it combined. Industry was calling forth efforts greater than had hitherto been put forward. Industry was crying out to be handled by scientific methods which had never yet been applied. A product was required to be put on the market at the most economic cost at which it could be done. Would any man dream for a moment that the small boot factory of one man and a boy in those times could carry on the industry in the same way as does the boot factory to-day with probably 2,000 men and half as many boys ? Of course, I am not speaking of boot factories, in Australia, because they have not yet attained to that stage when they employ such a large number of men. I am speaking of boot factories which, to my knowledge, employ that number of hands. Can we imagine for a moment that one factory with- a man and a boy would be able, to carry on the boot industry as economically and successfully as ai factory in which are employed the grandest machines that brains and money have been able, to devise, and to continue to satisfy all the demands of the market? We, of course, do not incline for a moment to any such belief. I hold that trusts have - as I fully anticipated - worked in a way that has been of infinite service to a good few millions of people. The establishment of trusts and combinations has proved that the man on whose behalf Senator Gray made so eloquent an appeal this afternoon is, after all, not an essential element in this or any other community ; that he is an incubus on any community ; and that there is no room for the calling in which ‘he is engaged. Trusts have shown that the middleman, too, can easily be dispensed with. They have also shown that a greater factor is operating side by side with, themselves, but upon an entirely scientific and unquestionably honest basis, not endeavouring to meet the trusts, not following the example of the Oil Trust, to which Senator Guthrie has referred, but working its way quietly amongst the people of the civilized world - as it has been doing for the past sixty years - and spreading so very widely that ultimately it will swallow the trusts. The trusts will have their bridges to burn, and both they and the bridges will undoubtedly go before the great economic force that is working such a complete revolution in the commercial and manufacturing history of England, and in the productive and manufacturing countries of Germany and Belgium, and which is also achieving such wonderful results in the agricultural and pastoral pursuits of Holland. I refer to the great movement known as the co-operative movement. Side by side with the trusts has grown up the great factor that is leading to the solution of the problem which we are trying to solve, and with which I think we are dealing in altogether a wrong way. I believe that there is only one way of stopping such a trust, as for instance, the shipping trust. Of course, Senator Guthrie, who is a very staunch, advocate of the shipping combine, does not believe that we can ever suffer any wrong at its hands. I am not going to accuse the combine of having inflicted any wrong upon us. I am only submitting that, as it is a trust or combine, one day it maypossess a power, and by the exercise of that power inflict upon us a very serious injury, and that even with this legislation at our back, we should be quite impotent to deal with it. If, however, we laid down a basis for the nationalization of combinations and trusts which might operate in restraint of trade and to the public detriment, then we should be taking the step which inevitably we should have to take in the end.
– But that is not the policv of the Government.
– I do not know what the policy of the Government is. I am inclined to believe that it is to try to prevent- the nationalizing of these industries.
– The Government have a very funny way of showing its policy then.
– We want to regulate them.
– My opinion is that Ministers are making the very best effort which they possibly can make to prevent injurious combinations. I do not think that they could have conceived of a grander method by which to retard the process of nationalization. It can only be retarded, because its advent cannot be prevented by either this or any other Government. It would be just as sensible to set ourselves the task of preventing trusts and combinations from coming. Where is there a man with a knowledge of commerce or industry to-day who would regard the stamping out of trusts and combinations as possible?
– What is the Bill for, then ?
– I do not know.
– To prevent trusts from doing an injury. A trust is not in itself an evil thing. Under the Bill we can deal with trusts when they do become injurious to the public.
– I believe that the Bill is an ‘honest attempt on the part of its framers to deal with trusts and combinations when they have become harmful to the industries of Australia. It is also aimed at the protection of the wages of the worker.
– Does the honorable senator think it will succeed in doing that?
– Certainly not. How would it be possible to protect the wages of a worker against the operations of a combination, which may do practically anything it likes? It is a large combination, but immediately it sets its foot upon Australian soil it waters its stock. The worker has to pay for the watering of the stock, and what could the Government, even with the provisions of this measure, do? They could no more call for an honest deal between the trust and the worker than I could. The man who watches matters closely and takes notice of industry and commercial life must see very clearly that trusts are merely the things we might have looked for. They are going to wipe out the small man and having buried him, their in memoriam will be. pronounced bv the nationalization of industries. Senator Guthrie was very much concerned about the position of the oil business in South Australia. I think that it was prior to 1894 that the United
States law was brought to bear, in Missouri, against the Standard Oil Company, but it utterly failed to achieve a conviction. The attempt to get a fair deal for the consuming public from the company was futile. On coming into office as Attorney-General of Missouri, Mr. Hadley - a young, but undoubtedly very smart man - -began to look up the legislation of the State, and at last he found that it possessed a law which was powerful enough to grapple with the evil with which the Federal law was utterly impotent to deal. He moved the Court, and got an injunction. He tackled this great company - consisting of three parts and known under three names. He put the company into such a position that the president of the central board of directors went so far as to deny its existence, as to tell Mr. Hadley on oath that he did not know where the office of the company was. The Attorney-General of Missouri, however, was not prepared to be baulked by an answer of that kind. He returned to the Court, and getting greater power, he compelled an answer to his question with the result that ever since that time Missouri has been able to deal with that great octopus, the Standard Oil Company. If Senator Guthrie will look through the Bill, until he is half as old again as he is, I do no.t think he will ever see any prevision within its four corners which would enable the Commonwealth Government to deal with a concern which was operating strictly within the limits of one State. Therefore, if there is a possibility of any one of the States being injured by an operation of that character, then certainly the remedy for the injurywill have to be provided by the State.
– I think that the honorable senator is mistaken.
– I may be mistaken, but that is how,- as a layman, I read the provision in the Constitution. I have come to the conclusion that there are so many differences of opinion amongst the legal members of the Senate on legal questions that laymen do well to form their own opinions. The Bill, in my opinion, will be unable to accomplish what it sets out to do. I also think it would be a great pity if it did accomplish all that it purports to do. It is impossible that it can be of any service to the worker. When his interests are weighed in the balance, how infinitesimal they are as compared with the mighty power of the opposing forces ! If the worker is to get justice, we must adopt that great system to which I have previously referred - that system that is manufacturing and distributing goods in. England to the extent of about ^96,000,000 per annum; that system that is doing such excellent work amongst the farmers and pastoralists of Holland ; that system that is showing such excellent results in the German banking accounts ; that system that is working out so handsomely in Belgium - the system of cooperation. That is the only system that -will give the worker his due; and when he gets his due, he will not be receiving about 10 per cent, of what he produces, but at least 90 per cent., and the extra ten will go to pay “ the other fellow “ who is doing the distributing. I shall vote for the second reading.
– I have no desire to prolong a debate which, it appears to me, has already been protracted to a wearisome .length. Many long speeches have- been made both for and against the measure. While there mav be some reasons for them on the part of honorable senators who think that, this is a bad’ measure, there is no reason why those who, like myself, wish t’o see it taken into Committee, should delay the proceedings. Possibly, if honorable senators who have indicated their intention of voting for the second reading had done so without giving such lengthy reasons, the Bill would have been law by this time, and the Senate would have been enabled to proceed with other possibly more important business. I do not wish it to be imagined that I am attempting in any way to lecture those who have made long speeches. Possibly, they may have acted from a strong sense of duty. But it occurs to me that a great deal of time is wasted in debating the second reading of a measure, nearly the whole of which has to be gone over again in Committee. A number of combines have been referred to as existing in Australia, and it has been said that this Bill will affect them. One combine has not been mentioned which, in my opinion, is doing as much harm to the people of Australia as any that has been denounced. I refer to the combine which regulates the publishing of the news of the world in our newspapers. It has been referred to in connexion with another Bill. I am glad to notice that Senator Pearce has on the notice-paper an amendment which he will propose in Committee to deal with that combine. When it comes forward, I shall be prepared with evidence which, I- hope, will convince the Senate that it is a combine which should, if possible, be brought under the Bill. I intend to vote for the second reading, though I do not think that the expectations cf the warmest supporters of the measure will be realised. I believe that combines cannot be regulated by a Bill of this description. But until the majority of the electors of Australia can be shown that it is impossible to regulate combines, and prevent the evils that arise from them by such legislation as this, they will not be in a frame ‘of mind to agree to the only certain remedy for monopoly, and that is the nationalization of all huge concerns such as the’ combines which have been mentioned, and the working of them in the interests of the whole of the people of Australia.
– The honorable senator will support the Bill in the belief that it will be a failure.
– I believe that it will be to a great extent a failure, though at the same time the dumping clauses will, in my view, give some immediate relief to many of our manufacturers.
Question resolved in the affirmative.
Bill read a second time.
In Committee:
Clause 1 -
This Act may be cited as the Australian Industries Preservation Act 1906.
Senator Sir JOSIAH SYMON (South Australia) [9.16]. - Now that Ave have got into Committee on the Bill, I shall do all that I can to assist in removing what I think are ambiguities and difficulties from it. The more I examine the Bill, the more I adhere to the opinion which I expressed in the second-reading debate - that it is not deserving of encomiums either for its drafting, its grammar, or the scheme embodied in it. When we reach the clauses which appear to me to be susceptible of improvement, I shall indicate many respects in which they require attention, in order to give them even the appearance of being workable. It is about the most muddled measure I have seen for some time. First of all, I ask honorable senators to consider the title. It is desirable that we should have a title that signifies what the Bill is. The present title is,, most of us will admit, an absolute sham. The Bill is not intended to preserve Australian industries.
Surely the Government does not wish to give to the Bill a title which, is a mere electioneering placard. The title “ AntiTrust Bill “ would sufficiently define it.
– That would not cover the dumping clauses.
– Did the honorable senator ever see the word “dumping” in a piece of legislation before? I have no objection to the word, if honorable senators like it ; but it is not to be found in any legislative measure in the world.
– Is it American or Australian ?
– I really do not know. It is a kind of slang term. I move -
That the words “ Australian Industries Preservation “ be left out, with a view to insert in lieu thereof the word “Anti-Trust.”
.- The title “Anti-Trust” would be’ more or less misleading. It would make it appear that the Bill was intended’ to deal simply with trusts. As a matter of fact, Part III. deals with the prevention pf dumping, and that is an essentially valuable feature of the measure. Indeed, some honorable senators have gone so far as to suggest that it is the most valuable portion. We now have an expressive title which truthfully indicates the objects aimed at. We should adhere to it. It would be unwise for us to accept a title that would fail to explain comprehensively the purport of the Bill.
– I propose to support the Bill for similar reasons to those given by Senator Pearce; but I am not at all favorable to the present title. “ Australian Industries Preservation Bill “ may be a good enough title for those who desire to go to the country with an electioneering placard, but that is not a sufficient reason for adopting it from my point of view. I , support the Bill because I am opposed to trusts and dumping. If it 0011 Id be called “Anti-Trust and AntiDumping Bill,” I think the case would be met.
– I do not mind that, if the honorable senator thinks it is necessary.
– I shall support Senator Symon’s amendment until I hear a better suggestion.
.- What we wish to secure is a title that will express as briefly and as fairly as possible the purpose of the measure. Although I do not pretend) to say that the present title - which I only wish could be made shorter - is the best that could be found, it certainly is the best that I have heard of up to the present to express the real object and meaning of the Bill. Suppose we used the words “anti-trust,” we should have to put in .some other words such as “anti-dumping,” and even then the whole object of the Bill would not be expressed. The measure does not exclusively deal with trusts but with individuals and with combinations of all sorts which are not trusts. The word “ trusts “ would not cover a great many of the matters dealt with. If we were only dealing with trusts, I could understand the suggestion, but we are dealing with monopolies which are not necessarily brought about by means of trusts - with monopolies created by ‘means of combinations of various sorts, and, in addition, with monopolies which are created by individuals.
– In the interpretation clause there appears - “ Commercial Trust “ includes a combination, whether wholly or partly within or beyond Australia, of separate and independent persons (corporate or unincorporate) whose voting power or determinations are controlled or controllable by-
– That is simply a definition of “Commercial Trust,” whereas the Bill deals also with individuals. Clause 7 speaks of -
Any person who monopolizes or attempts to monopolize, or combines or conspires with any other person to monopolize any part of the trade or commerce…..
Under the circumstances the word “ antitrust” would not be truthful.
– But according to the interpretation clause “ person “ includes corporation and firm, and also a commercial trust.
– Yes, “ includes “ ; but if we used the word “ antitrust,” it would imply that we were dealing only with trusts. Whatever title we have, let it be truthful. If any honorable senator can suggest a better and more complete title, I shall consider it, but under the present circumstances I must oppose the amendment.
– We so frequently feel called upon to suggest want of consistency on the part of our fellow senators that it is with considerable pleasure I compliment Senator Best on the remarkable consistency he has displayed this evening in his remarks on the title of the Bill. I need hardly remind the honorable senator that on quite a recent occasion he ventured to defend the title of another Bill on the ground that it was picturesque.
– And expressive.
– I am quite certain that Senator Best made use of the term “ picturesque.” Now it seems from his remarks that the same artistic idea is present, and he desires to have a picturesque placard in the forefront of this Bill. I quite agree with the Minister of Defence that the title should be expressive of what the Bill is supposed to contain. But there seems to be a feeling in the Chamber that the present title does not quite meet the case. I recognise the deficiency in the title suggested which does not completely describe the measure. Before I make any suggestion, I desire to point out that if honorable senators read the debate which has taken place, and also the criticisms and articles in the newspapers, they will find the Bill invariably referred to as the “ Anti-Trust Bill.” If we were to go to a man in the street, and ask him if he knew of the “Australian. Industries Preservation Bill,” he would certainly think we were talking about the Tariff or bounties, whereas if we asked him if he knew the “ Anti-Trust Bill “ he would recognise it at once.
– Does the honorable senator seriously put that forward as a reason for altering the title?
– The same argument might be used for calling the Capital Sites Bill the “ Bush Capital Bill.”
– And it’ probably will be used before the debate on that subject is over.
– That is the honorable senator’s argument - that the newspapers so refer to the Capital sites.
– Only one newspaper.
– I could show the honorable senator more than one newspaper which speaks of the “ Bush Capital.”.
– I am not disputing the fact that some newspapers which support the honorable senator do so speak of the Capital Site; but I have no knowledge of those newspapers, and I do not want it. My suggestion is that if we desire to express readily, not merely to lawyers, but to ordinary citizens, what the Bill deals with, we ought to make the title the “ Trusts and Dumping Act 1906.” That certainly would convey at once the idea that this was a Bill dealing with trusts, and also with dumping.
– Why not call it the “Trusts and Dumping Regulation Act”?
– That is rather long, and we had better leave the title as it is.
SenatorMILLEN. - Whatever title is adopted, we ought not, at any rate, to have the present one. I entirely agree with Senator Croft that, whilst the present title may be useful as an electioneering placard, it possesses no other advantage. As one who believes in legislation for the regulation of trusts, I strongly object to a title which might appear to many minds to have a fiscal bearing.
– I suggest that we adopt some more descriptive title than the present one. The Government, in one particular, themselves saw the necessity for a change in this direction, because in the digest of cases which they furnish they used the phrase “ antitrust legislation.”
– And the same phrase was used in the abstract of legislation.
– That dealt only with a branch of the Bill.
– United States Statutes, which number altogether twenty-one. and deal with a variety of subjects, are all called “ anti- trust laws.”
– The United States Acts are generally referred to by the name of the introducer, as in the case of the Elkin Act.
– In all the textbooks the United States Statutes are comprehensively referred to as “ the antitrust laws.” Each principal law takes the name of the introducer of the Bill but the whole are referred tfe in the way I have indicated. I move -
That the amendment be amended by inserting after the word “ Anti-trust “ the words “ and Regulation of Dumping.”
– Why not name the Bill the “Trust and Dumping Act’-‘?
– We are not now amending the order of leave, and neither are- we laying out the full scope of the Bill. All we are doing is to fix upon a short title, and the fact that we leave out one section does not affect the matter. We require a short title expressive of the main lines of the Bill. The first part deals with the regulation of trusts and monopolies, and we know that trusts are sometimes spoken of as monopolies, and vice versa, so that the word “ anti-trust “ would cover it. The second part deals with, not the prohibition, but the regulation, of dumping, and there again the title I suggest would cover the whole scope of the measure. I agree with those who’ say that the present title is altogether a misnomer. The Bill does not affect a large number of industries, and it is very doubtful whether in actual operation it will tend to the preservation of Australian industries. On the other hand, I can quite conceive that, if used to its fullest extent, it might mean the ruin of certain Australian industries. The draftsman has not adopted the title generally used by writers on legislation of this class, and I trust the Government will see the error they have made and accept the amendment.
– - 1 intend to support the Government in adhering to the present title of the Bill. I do not think that the term “AntiTrust “ would apply, for the simple reason that this is not an Anti-Trust Bill until a trust has become injurious, and has done something with intent to destroy or injure an Australian industry, the preservation of which is advantageous to the Commonwealth. The real purpose of the Bill is to- protect Australian industries, and that being the case, I think the present title is sufficiently expressive of the intention.
– There is, I think, one title which would correctly describe every part of the. Bill, the whole of which has to do with the operations of trade. The Bill affirms that under certain circumstances the operations of trade shall be restricted, because, in consequence of rings or monopolies, there may be a danger of those operations being injurious to Australian industries. In regard to the dumping clauses, it is suggested that trade, if left free and unrestricted, might also be injurious, and, therefore, I suggest the title, “ Trade Restriction.” The whole object of the measure is, under certain circumstances, to restrict trade, and we cannot imagine any title which, would describe every operation that may take place. This Bill admittedly is a preventative measure, to come into operation whenever some danger threatens any particular industry, and, as I say, it seeks to restrict trade under certain circumstances. I make this suggestion in reply to the challenge of the Minister of Defence for a comprehensive and correctly descriptive title.
– I do not see why we should wander all over the place looking for a title. I do not suppose that we shall be any better off when the Bill is christened than we are at present. I should like to direct attention to the position as it appears to me. This is not an Anti-Trust Bill - it is not for the purpose of legislating against trusts.
– I think the suggestion that the honorable senator has already made is the best one.
– This is really an Anti-Monopoly Bill, and it only comes into operation when a monopoly becomes injurious. To what is a monopoly going to be injurious? Is it not to Australian industry ?
– That is the key-note of the Bill.
– The Bill is directed against injurious monopolies, and there must be injury to Australian industries before any action can be taken and yet we are going hunting round for such titles as the >” Anti-Trust Regulation Act,” “Anti-Trust and Dumping Regulation Act,” and so forth. The whole purpose of the Bill is the preservation of Australian industries. No monopoly, no trust, no individual, is interfered with until their operations become, in a certain way, detrimental to some Australian industry. If honorable senators are so indefinite, why not accept the present title?
– The strong appeal made for truthfulness suggests to me how misleading the title really is. Senator McGregor has pointed out that by the Bill we propose to legislate against trusts and monopolies only when they threaten an Australian industry, and that, therefore, the title is quite accurate. Might I ask the honorable senator whether the Bill will protect the cattle industry of the northern rivers from tick? That industry is threatened to-day ; will the Bill preserve it?
– The industry is not threatened by a monoply.
– But the title says nothing about monopolies, and I have mentioned an industry which is threatened. Then, again, there is the apple trade of Tasmania which is threatened . by the codlin moth; does the Bill preserve the apples of the little island? Therefore, I say that the title does not accurately describe the purpose of the Bill, but is far too comprehensive for a measure which deals only with certain industries, and seeks only to preserve them from certain dangers. It seems to me that the title suggested by Senator McGregor, in an interjection, namely, the “ Trust, Monopoly, and Dumping Act “ is better than the present title.
Senator Sir JOSIAH SYMON (South Australia) [9.44]. - I was rather astonished to hear the vehement and earnest eloquence of Senator McGregor. I thought the honorable senator rose to support the suggestion he threw out by way of interjection, but his remarks show the value we are to attach to his suggestion made with a views to shortening the discussion. The honorable senator first suggested that this should be called “The Trust and Dumping Act, and I then, also by way of interjection, expressed the opinion that that was infinitely preferable to the present title. In spite of the ingenious and casuistical reasoning of Senator McGregor, there is no doubt that the present title is utterly misleading. There are hundreds of ways of preserving Australian industries. I, as a free-trader, know of one great way, and I suppose that Senator McGregor knows of another way, namely, by nationalization. I do not know whether he adheres to that policy, but, judging from his recent remarks, I should say that he repudiates it. The present title assumes that the Bill which we hope to place on the statute-book in some shape or other is the only measure for the preservation of Australian industries.
– It is not “the,” but only “ a,” measure with that object.
– It is described as “The” Australian Industries Preservation Bill.
– It is a Bill -
For an Act for the Preservation of Australian Industries, and for the Repression of Destructive Monopolies.
– We are not dealing with the long title of the Bill, but with the short title, which is clearly misleading. I am quite willing to adopt the suggestion of Senator McGregor, but, in my opinion, the better title is “ Monopolies and Dumping Act,” because that covers the whole subject, and even that term I am quite willing should be amended if it can be shortened. The Sherman Act contains no short title, but the expression in the marginal note is “ Anti-Trust Act.” That term would be ample, but still, I do not desire to put that in. I think it is very much better without than with “ anti.”
Question - That the words proposed to be left out be left out - put. The Committee divided.
AYES: 9
NOES: 13
Majority … … 4
AYES
NOES
Question so resolved in the negative.
Amendments negatived.
Clause agreed to.
Clause 2 -
This Act is divided into parts as follows : -
Part I. - Preliminary.
Part II. - Repression of Monopolies.
Part III. - Prevention of Dumping.
– I desire to draw attention to the expression “ Repression of Monopolies.” In the Bill, I understand, it is not proposed to abolish monopolies. The Minister has told us that some monopolies are of a beneficent character; therefore, I suppose he does not wish us to abolish that which is beneficent.
– “Repression of Monopolies,” would only refer to the repression of injurious monopolies. It would not interfere with beneficient monopolies.
– The clause does not say that. I move -
That the word “ Repression “ be left out, with a view to insert in lieu thereof the word “ Regulation.”
Senator Sir JOSIAH SYMON (South Australia) [9.54]. - I have no objection to the omission of the words “ Repression of.” I do not see why Part II. of the Bill should not be called “ Monopolies.” I do not think that the word “Regulation” should be inserted, because it is not a Bill for the regulation of monopolies. The only monopoly which ought to be recognised is one which raises prices ; but still, if the Government wish to retain the word “ Monopolies,” I have no objection. I see no necessity, however, to insert “ Regulation “ in place of “ Repression.”
Amendment, by leave, withdrawn.
Amendment (by Senator Pulsford) negatived -
That the words “ Repression of “ be” left out.
Clause agreed to.
Clause 3 -
In this Act, unless the contrary intention appears- “ Commercial Trust “ includes a combination, whether wholly or partly within or beyond Australia, of separate and independent persons (corporate or unincorporate) whose voting power or determinations are controlled or controllable by -
the creation of a trust as understood in equity, or of a corporation, wherein the trustees or corporation hold the interests, shares, or stock of the constituent persons ; or
an agreement; or
the creation of a board of management or its equivalent ; or
some similar means ; and includes any division, part, constituent, per son, or agent of a Commercial Trust. . . .
Senator Sir JOSIAH SYMON (South Australia) [9.55]. - I desire the Minister to explain the definition of “ Commercial
Trust.” What, for instance, is the meaning of the expression “ the creation ofa trust as understood in equity “?
– That is a legal question, which my Honorable and learned friend ought to be able to answer. “ It is really too bad to ask me what it means.
– I quite expected to receive that answer, because I have never heard of such trusts “ in equity “as are sought to be dealt with by the clause.
– “ As understood in equity.”
– Certainly not. The, trusts which are supposed to be dealt with by the Bill are trusts as understood in commerce, I should think. ,
– The word “trust’ in paragraph a is used to express the legal relation that would arise betweenthe persons.
– But it does not express it.
– I think so.
– Does the Minister know of any Act on which this Bill is supposed to be founded, and in which that expression is used? I can find none. Neither the Sherman Act nor the Wilson Act contains the phrase. But in each Act the word “trust” is used. I do not propose to move the omission of thewords “as understood in equity.” The Bill is beset with enough difficulties already, and I invite the Minister to consider if it is not encumbering the expression “trust,” which is well understood in connexion with these things in commerce, by surrounding it with something which is supposed to give it a legal interpretation, but which would only confuse it. If he will look at the beginning of the interpretation he will seethat - “Commercial Trust” includes a combination, whether wholly or partly’ within or beyond Australia, of separate and independent persons.
What does that mean? Why not say simply “a combination of persons”? Persons are all, I suppose, separate and independent. Why put in the words separateand independent, then? If there is any particular signification in using the words, I think that the Committee ought to be informed of what it is. Then the definition also contains the words “corporate or unincorporate.” I do not know what that means. Really, it is the funniest’ Bill I have ever seen. Some person with a copious command of terms has simply put in as many as he could. If my honorable friend will look at the definition of “person,” he will find that it includes a corporation. Why, then, in the definition of “ commercial trust,” say persons corporate or unincorporate ? Surely, it is sufficient to say “ a combination of persons “ unless there is some signification sought to be attached to the words to which I have referred.
– The word “ trust “ as used in paragraph a of the definition of “ commercial trust “ is not synonymous with the word “ trust “ as used in the term “commercial trust,” but is used to express the legal relation that arises between persons who have placed themselves in some position of mutual agreement. In order to realize the necessity for the use of those words, we must consider the history of American trade both prior to and since the introduction of what is known as the Anti-Trust Law of the United States. First of all, the Legislature of that country was confronted with this posi-tion - that a number of persons who were engaged in a particular department of trade or enterprise would enter into what was known as a simple combination. They would combine together for a common purpose, either to prevent the continuance of the competition in which they had been engaged one against the other, or to regulate the prices at which they would sell the articles, which all of them produced, or to regulate the prices at which they would buy, say, stock, to be afterwards converted into meat to be sold to the public. Legislation was introduced to prevent that mischief, and under its provisions the Courts found it very easy to repress such combinations. They were enabled to rule that any combinations of that character were against the law. and, consequently, the contracts which had been entered into to bring the combinations into existence were invalid, and, in some instances/ subjected the contracting parties to penalties. But, not to be daunted by such legislation, these ingenious individuals conceived another method of effecting the object which they had intended than that which the law had 1 already decided was illegal, and should be punishable. They then decided to’ appoint certain persons who would represent them in common. They would be come, so to speak, a combination or corporation amongst themselves. Their own stock in the corporation they parted with individually to trustees. They gave the trustees the legal power to regulate and to carry out their combined business, and the relation in which the parties stood one to another and with the trustees holding the several stocks ofl the different individuals was a relation which would be known in law as a trust. The trustees held the stock and regulated the business. The only evidences of their title that the. individual persons engaged in the business held were certificates or declarations from the trustees. Legally speaking, therefore, the trustees, as representing all the individuals, could carry on the combined business in a way in which the law had declared that several persons by a simple combination could not do. For some time, they- managed to evade the principles of the law by establishing a trust of that kind. It is in order to prevent a combination of that character being formed that it is provided in this clause that a commercial trust shall include amongst other things a number of persons combined together, controllable by -
The object is to prevent the’m from combining together and appointing certain trustees to legally represent them, who might otherwise say, “ We, and not these several individuals^ are carrying on this business.” That is why the word “ trust “ is used in that connexion.
– The use of the word “ trust “ is perfectly right, but it is the use of the phrase “ as understood in equity “ which is wrong. If my honorable friend will look at the dictionary he will see that it is not as understood in equity, but as understood according to commercial usage.
– What we are seeking in the definition of commercial trust to do is to provide that ‘persons who combine together simply and openly shall come within its scope. We also want to provide that they shall not escape the penalties attachable to the establishment of a commercial trust for the injury of Australian industries, simply by parting, so to speak, with their stock in a joint concern or corporation to trustees, and so placing themselves in relation to the trustees and in their mutual relations one to another in the position of a number of parties between whom there is what is known as the equitable relation of a trust. That is the reason why we have this paragraph -
The experience of America has revealed that it is not sufficient to provide that persons shall not simply combine together, because these men have been able to evade such legislation. It dictates the necessity for provisions as stringent as this one. I agree with Senator Symon that the words “ as understood in equity” cannot be found in any Act.
– All I ask is whether anything is gained by, putting after the word “ trust “ which is a commercial trust, the words “ as understood in equity.”
– I think so.
– No, because it is not as understood in equity, but as understood commercially.
– In this clause we are speaking of a number of persons com- bined together. The term “commercial trust ‘ ‘ was adopted as a convenient method of expressing an organization banded together - whose voting power or determinations are controllable by the creation of a trust as understood in equity.
– As the clause defines it, why leave something to be understood?
– We are leaving nothing to be understood.
– Does the honorable senator find the expression in any other Act?
– No; and I am pointing out the reason why. In America legislation has been of a piecemeal character, and in this Bill we are taking advantage of the American experience. We want to make the Bill as watertight as we can.
– The first Sherman Act had the word “trust.”
– And it was found to be weak in practice. There is no limit to the ingenuity of persons who desire to evade the law. I do not suggest that there is a large number of persons in this or any other community who are continually busy exercising their ingenuity in that respect. But there is a certain percentage of people everywhere who look for loopholes, and we must have, in this regard, the widest form of expression. The definition which we are discussing uses terms which are as comprehensive as possible for expressing the relation that may exist between persons forming a trust.
Senator Sir JOSIAH SYMON (South Australia) [10.10]. - Does my honorable friend Senator Keating see any necessity for leaving in the words “ separate and independent “ ? Would not the words “of persons “ be sufficient. I move -
That the words “separate and independent,” line 5, be left out.
– To me the words objected to by Senator Symon appear to be ridiculous. It is not unreasonable, when anything appears in a Bill which strikes one as being superfluous, that the Minister in charge should explain why the words objected to have been inserted.
– This is a matter of drafting, and I am not a draftsman.
– If the Minister is unable to explain why the words should be retained, surely it is not unreasonable that we should object to them.
– If honorable senators opposite cannot give reasons why the words should be struck but, it is unnecessary for me to furnish reasons why they should be retained. If they are not harmful they may as well remain.
– I am sorry that Senator Symon has not given reasons why the words to which he objects should be struck out. If the draftsman had inserted the word “ single “ instead of “ separate” I suppose the legal element in the Senate would have raised a question whether “ single “ meant “married.” As to the word “independent,” it is necessary that it should be included to indicate whether the members of the trusts are sober, and not leaning up against each other ! Cannot honorable senators see the ridiculousness of raising an argument about such simple terms? I have heard such words read in indictments and bills of costs ; and, seeing that there is no reason shown by Senator Symon why they should be struck out, I do not see why they should not remain just to give the Bill a little tone.
– If honorable senators will imagine that the words “ separate and independent “ are out of the definition they will see that without them a commercial trust might be construed to mean any ordinary legitimate private trading corporation. The definition would read -
Commercial trust includes a combination whether wholly or partly within or beyond Australia of . . . persons corporate or unincorporate whose voting power or determinations are controlled or controllable by.
What we are legislating; against is the combination of several independent persons who are separate and independent in reality and in fact, but who are combined for a specific purpose in the form of a commercial trust. That is the essence of the creation of a trust. The word “ persons “ includes, by virtue of the definition, a corporation or firm; and it is because they are independently carrying on business in the first instance, that when they combine together they become a trust.If there were a number of persons combined together in some branch of manufacture or industry quite legitimately, they would not be a trust. They would form a corporation for the purpose of carrying on that branch of trade. But if there is another corporation and a third, and the three combine together, they may become a commercial trust.
Senator Sir JOSIAH SYMON (South Australia) [10.16]. - We are indebted to Senator Keating for his explanation. Ido not think it necessary to refer to the remarks of Senator McGregor, because he evidently does not treat the question seriously. Perhaps he is incapable of treating it seriously. It is advisable that we should make this Bill as free as possible from terms that are likely to confuse. The Senate is not responsible for the drafting; of the Bill, but so far as I am concerned, I propose to assist to make it as clear as possible. In the definition of “ commercial trust,” there should not be introduced more debatable matter than cannot be avoided. The definition is - “Commercial Trust” includes a combination whether wholly or partly within or beyond Australia -
Of whom? Of persons. What additional efficacy is there about putting in the words “ separate and independent “? We might put in “corporations and firms,” and leave out persons, altogether.
– “ Persons “ includes “firms.”
– The word “ persons “ includes everything we can desire to include.
SenatorKeating. - It includes more than we desire. It would bring in an ordinary company. We only want to bring in a combination of companies.
– The Bill does more than that now.
– No, it does not.
– My honorable friend does not understand his own clause. Every one of these persons is separate and independent. Else there could not be a combination. The words “corporate or unincorporate” are not wanted either. Why put them in? The combination is the vice that is intended to be met. But “ separate and independent “ are words that are calculated to create difficulty and controversy.
.- I think that the Committee will be very wise in adhering to the definition. The more it is studied the more carefully one can see that it has been drawn. It is clearly founded on cases. It seeks to deal with three separate conditions of development in connexion with trusts. First, it deals with the agreement of various firms or persons or corporations. That was the first form that the trust assumed. That was held by the Court to be fundamentally wrong and in restraint of trade.
– What was ? Senator BEST. - An agreement on the part of firms and corporations for the purpose of controlling, trade. The next step was for the members of the trust to transfer their various stocks to trustees who executed a declaration of trust. Hence it is that the words “ the creation of a trust as understood in equity,” are used. That is the widest possible term that could be used. The Court also struck at that form - of declaration of trust. Then came the third development. That was the creation of a corporation for the purpose of holding stocks, and thereby controlling the trade; and in the Northern Securities case - the great Merger case - if was held that that also was totally illegal. That was the biggest blow that had been struck at the trusts up to that time. This definition is drawn to meet those three separate conditions of affairs. The, widest possible words are necessary in order to cover the whole ambit of the cases which have been decided. The words are expressive.
– Does the honorable senator think that the words ‘ corporate or unincorporate “ are necessary ?
– They certainly extend the meaning ; but what I am urging is that the definition most comprehensively deals with each separate development - first .the agreement, secondly the declaration of trust, and thirdly the holding corporations. In regard to each of these several stages cases have been decided. Whilst technically one or two words might be held, to be surplusage, it is desirable that we should use words that make the meaning clear and distinct, and which would cover every case that might arise.
Amendment negatived.
– * draw the attention of the Minister to the words “ some similar means” in the interpretation of “Commercial Trust.” What is the object of these words, in view of the words of paragraph £?’
– There are always some new developments in connexion- with these matters, and we must make the definition as wide as possible.
– The words do no harm.
– Al] that the Minister has to say is that the words do no harm.
– If the honorable senator cannot show that there is any Harm in the words, what is the use of his taking up time?
– I am . merely showing that the words are superfluous, and it is usual under such circumstances to at once strike words out. However,’ I shall not press the point. It is not my Bill.
Clause agreed to.
Progress reported.
page 3098
Earthquake in Chili.
Motion (by Senator Playford) proposed -
That the Senate do now adjourn.
Senator PULSFORD (New South Wales) [10.28I. - I had Hoped that the representative of the Government would this afternoon have submitted a motion expressive of our sorrow at the great calamity which has befallen the Republic of Chili. I now mention the matter in the hope that the Minister will consider the desirability of placing some proposal before us tomorrow.
– I do not know what the Prime Minister is doing in the matter, but I do not think, that any motion of the kind suggested was moved when a similar calamity befel our cousinsat San Francisco.
– I may say that on that occasion I sent a telegram, on behalf of the Senate, to the President of the United States;
– A similar course might be adopted now, but I do not think that we should single out a South American Republic, with which- we have very little connexion, when we did not submit a motion of the kind in regard to people more nearly related to us.
Question resolved in the affirmative.
Senate adjourned at 10.30 p.m.
Cite as: Australia, Senate, Debates, 21 August 1906, viewed 22 October 2017, <http://historichansard.net/senate/1906/19060821_senate_2_33/>.